Australia's interest rates remain on hold at the historic low of 0.1 per cent as the nation rebounds from the economic battering caused by COVID-19.
The nation's top economists from the Reserve Bank of Australia (RBA) met for the first time in 2021, deciding to maintain rates in the wake of a booming property market and rebounding employment figures.
Last year marked a near-unheralded year for the RBA, which cut the nation's cash rate three times in response to fears that COVID-19 restrictions would crush property prices.
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In February 2020, interest rates sat at 0.75 per cent. Fast-forward 12 months, and that rate has dropped 65 basis points to what many are calling the bottom of the cycle.
"It's likely we're nearing the bottom of the cycle, provided the economic recovery stays on track and the RBA can keep the cash rate above zero, as planned," RateCity.com.au research director Sally Tindall said.
A handful of lenders have hiked new customer rates since the beginning of the year, however they're still in the minority.
"We expect new customer rates will stay low and competitive throughout 2021 as people flock back to the property market," Ms Tindall said.
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RBA Governor Philip Lowe has previously said it's likely interest rates will maintain their 0.1 per cent level for three years.
In his monetary statement in December, Mr Lowe said the RBA expects Australia to be near-on fully recovered from the economic damage caused by the virus by the end of this year.
"In Australia, the economic recovery is under way and recent data have generally been better than expected," Mr Lowe wrote.
"This is good news, but the recovery is still expected to be uneven and drawn out and it remains dependent on significant policy support. In the RBA's central scenario, it will not be until the end of 2021 that the level of GDP reaches the level attained at the end of 2019.
"In the central scenario, GDP is expected to grow by around 5 per cent next year and 4 per cent over 2022."
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Ms Tindall said the reality for Australians is that lenders are offering home loans with record-low rates.
"Lenders aren't handing out these record low rates to everyone – they're largely reserved for new customers. Even then, you often have to be an owner occupier with a decent amount of equity in your home," she said.
"The latest ABS Lending Indicator data shows 237,632 people have refinanced since the start of COVID, however, last month's figures are down considerably from the May 2020 peak.
"There are still likely to be hundreds of thousands of home-owners that can significantly benefit from refinancing, or, at the very least, by picking up the phone to their own bank."
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