Rates to go down, but not for a couple of months as RBA holds fire: John Symond

Aussie Home Loans chairman John Symond expects home mortgage interest rates to come down further following the low June inflation reading, “but not for a few months”.

Speaking to Channel Seven’s David Koch on Sunrise yesterday, Symond said the RBA would be happy with the low current rate of inflation (O.5% for the June quarter) as it keeps the cost of living down.

But it would want to wait and see what happens in Europe.

“The RBA is pretty happy with where Australia is at the moment. Unemployment is OK, the housing market is still tough, but all in all we are in reasonable shape – certainly better than anywhere else,” Symond said.

Symond says the RBA would want to keep “something up their sleeve” to act quickly if need be and “things start to slide”.

Symond was also questioned on demands from financial services minister Bill Shorten that banks reveal the interest rates they charge in different suburbs in order to be more transparent.

“I don’t know how you could do that,” Symond chuckled, “It would be pretty hard.”

But he said it was true that a bank may offer a rate half a percent cheaper to a low-risk first-home buyer with a big deposit wanting to borrow a $1 million than a struggling high-risk borrower in the suburbs.

And with this remark he moved swiftly into the message behind Aussie’s latest campaign “It’s smart to ask” calling on borrowers to ask their bank for a better deal and if they don’t get  one, to talk to an Aussie mortgage broker.

“The only way the banks reveal [the rates they are offering] is when you phone them up and demand a better deal.”

“That’s what people ought to be doing.”

Those readers thinking about refinancing their home loan should sign up for Property Observer’s free webinar: Refinancing and the interest rates riddle taking place on Tuesday 31 July a 12:30pm AEST.