Rising bond yields and the expectation that lenders’ funding costs may increase are starting to have an impact in the mortgage market, where a few lenders have increased longer term fixed rates.
According to the latest Mozo Banking Roundup, last month five lenders increased their mortgage rates for four and five-year terms. They are Aussie Home Loans, Bank of Queensland, Bendigo Bank, Commonwealth Bank and Teachers Mutual Bank.
This trend is emerging as lenders continue to cut short-term fixed rates.
Aussie cut its two-year rate by 15 basis points to 1.99 per cent, while it increased its four-year rates by 20 bps to 2.19 per cent and its five-year rate by 30 bps to 2.29 per cent.
Bank of Queensland cut two and three-year rates by up to 45 bps, while increasing its four-year rates by 10 to 30 bps (depending on the LVR) and its five-year rates by 20 to 30 bps.
Bendigo Bank cut its two-year rate by 10 bps to 2.04 per cent, while increasing its four-year rates by 30 bps to 2.34 per cent.
CBA cut its one, two and three-year rates, while increasing its four-year rates by 20 bps to 2.15 per cent.
Teachers Mutual Bank increased four and five-year rates by 9 to 24 bps, depending on the borrower type.