What to do when those low fix rates run out

During the early stage of the pandemic years, while the cash rate and therefore the home loan interest rated where coming down, so where fix rates.

I have friends that snapped up rates under 2% for 2 or 3 years.

Research tells me its estimated that around 46 per cent of all home loans in July 2021 were fixed rate loans.

The RBA said recently that it expects about half of all those outstanding fixed loan debt to change to variable rates throughout 2023.

Just how many fixed is hard to determine, but in the words for the government the “back of the envelope” calculations puts it at around 800,000 facilities, and the Reserve Bank says that’s around $350 billion of credit that is rolling off low fix rates. It’s a busy time in lending.

Annual inflation as measured by the Consumer Price Index (CPI) has increased from a little below 2 per cent in the years immediately prior to the pandemic to around 8 per cent at the end of 2022.