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INTEREST rates have been reduced again in Australia by quarter per cent, saving business borrowers and home buyers thousands of dollars over the life of their loan.
It has been estimated that the cut will save a borrower around $21 a month on repayments on an average 25 year loan of $130,000.
This combined with the lower Australian dollar and the Federal Government's doubled home loan grant of $14,000 to first time buyers, including newly-arrived migrants, of new houses will make even a really first class house in Australia cheap in sterling terms.
Australia's largest single lender of home loans, the Commonwealth Bank has cut its standard variable home loan rate to 7.32 per cent; its base variable rate to 6.81 per cent; the one year guaranteed rate to 5.59 per cent. Fixed rates are: 1 year - 6.40 per cent; 2 years - 6.40 per cent; 3 years - 6.50 per cent; 4 years - 6.60 per cent; 5 years - 6.60 per cent.
The residential property investment loan is currently at 7.45 per cent. These rates are generally in line with those offered by the other major banks, although the smaller lenders often have slightly lower rates.
If the Australian economy does not pick up in the next few weeks it is expected that the Reserve Bank (equivalent to the Bank of England) will further reduce lending rates, especially if the United States sets this direction.