Off the back of persistent low inflation, the rate cut represents an attempt to jump start economic growth.
For a mortgage holder with a home loan of $300,000, the rate cut equates to around $50 back in your pocket… if the banks pass it on in full.
It seems the big four banks are holding out, passing on only a portion of the cut. Bank Australia was the first lender to announce it would pass on the cut in full.
Check out this list of banks on finder.com.au to see whether your bank is feeling generous or holding out on you.
Not surprisingly the Real Estate Institute of Queensland (REIQ) is pretty chuffed at the cut, but perhaps not so chuffed that some banks are playing hard ball.
“With wages growth virtually nil, inflation low and jobless numbers not moving, people need a little help with mortgage repayments and the general cost of living,” REIQ Chairman Rob Honeycombe said.
“It is our hope that lenders pass on this rate cut in full and give the benefit to home buyers, as the Reserve Bank intends.”
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