The Reserve Bank of Australia (RBA) kept the cash rate on hold again at 4.10% this month, with big bank economists tipping that this cycle of tightening has peaked.
Your mortgage repayments have likely caught up with the latest increases if you were on, or have now switched to, a variable rate home loan. If you’ve been considering refinancing to nab a lower interest rate and reduce your mortgage repayments, it may be worth familiarising yourself with some of the most competitive rates on the RateCity database this month.
Meanwhile, savers who are looking to boost their nest eggs may be wondering who is offering the highest rates on savings accounts and term deposits? Especially now that big four bank economists have predicted that rates may fall again as early as March 2024.
Let’s explore some of the most competitive interest rates for homeowners and savers for September 2023.
Lowest variable home loan interest rates
Just because the cash rate has been held this month doesn’t mean that major banks will stop increasing their interest rates. In fact, RateCity research shows that the big four banks have increased at least one new customer variable rate 22 times since March 2023 – outside of the RBA cash rate hikes.
The big four banks no longer offer home loan interest rates starting with a ‘5’. This is why it’s more important than ever to compare a range of home loan options, so that you can ensure you’re choosing the right loan for your financial needs.
These are some of the lowest variable interest rates for owner-occupiers paying principal and interest on the RateCity database, accurate at the time of writing.
Lowest owner-occupier variable rates
- Fire Service Credit Union – 5.39% (comparison rate 5.68%)
- Arab Bank – 5.45% (comparison rate 5.58%)
- First Option Bank – 5.49% (comparison rate 5.49%)
- Pacific Mortgage Group – 5.54% (comparison rate 5.54%)
- Hume Bank – 5.59% (comparison rate 5.60%)
Source: RateCity.com.au. Data accurate as of 14/09/2023
Meanwhile, investors will be keeping an eagle eye on bargains in the property market as it continues to recover from recent downturns. As prices continue to rise, more first home buyers may be pushed out of the market, opening the door for investors to step in.
If your potential home purchase is more expensive, you’ll want to know that you’re keeping ongoing costs as low as possible. This is where a lower-rate home loan may come in handy.
These are some of the lowest variable interest rates for investors paying principal and interest on the RateCity database, accurate at the time of writing.
Lowest investor variable rates
- First Option Bank – 5.74% (comparison rate 5.77%)
- Easy Street – 5.79% (comparison rate 5.84%)
- Bank Australia – 5.79% (comparison rate 5.84%)
- Queensland Country Bank – 5.84% (comparison rate 5.85%)
- Pacific Mortgage Group – 5.89% (comparison rate 5.89%)
Source: RateCity.com.au. Data accurate as of 14/09/2023
Highest savings account interest rates
The RBA may have kept the cash rate on hold this month, but savings account interest rates remain high. In fact, there are a range of options now with ongoing rates of at least 5.50%, and even more providers offering rates above 5%.
NAB has also forecast another hike may occur this year. If this were to occur, competition for deposits could mean interest rates climb even higher. However, it’s likely that it would be the last hike in this cycle of tightening.
So, who is offering competitive interest rates on savings accounts at the potential peak of this cycle of tightening? These are some of the highest interest rates for conditional savings on the RateCity database, accurate at the time of writing.
Highest conditional savings accounts (adults)
- ME Bank HOMEMe – 5.65%
- ING Savings Maximiser – 5.50%
- BOQ Future Saver (ages 14 – 35) – 5.50%
- MOVE Bank Growth Saver – 5.50%
- Teachers Mutual Bank Target Saver – 5.50%
- Great Southern Bank Goal Saver – 5.35%
Source: RateCity.com.au. Data accurate as of 14/09/2023
Highest term deposit interest rates
If jumping through hoops to earn a higher rate isn’t for you, or if you prefer to set and forget your savings, it may be worth comparing high interest term deposits. Term deposits allow you to lock away your savings over a set period of time at an agreed-upon interest rate. Meaning that your return on investment is all but guaranteed.
Further, in contrast to investment options like ETFs and stocks, term deposits are backed by the Financial Claims Scheme, often referred to as the government guarantee. If you have a deposit with an authorised deposit-taking institution (ADI), your nest egg will be safeguarded up to the value of $250,000 – even if the provider went under.
If we have reached the peak of what the cash rate will climb to for at least the next year, it may be worth considering locking in a competitive rate now before interest rates fall again.
These are some of the highest interest rates for 12-month term deposits on the RateCity database, accurate at the time of writing.
Highest 12-month term deposit interest rates
- Bank Australia – 5.25%
- G&C Mutual – 5.20%
- QBANK – 5.10%
- Arab Bank – 5.10%
- Unity Bank – 5.05%
Source: RateCity.com.au. Data accurate as of 14/09/2023
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