Loan Group
executive director John Kolenda says their brokers have seen a decline in demand for fixed rates.
"The lack of demand to switch to fixed rates indicated the majority of home owners believed they would be better off sticking to variable rates while the economy remained in decline," Mr Kolenda said.
Most economists seem to believe that the Reserve Bank of Australia will cut rates again over the next 12 months due to rising unemployment.
Variable home loan rates are currently at around 5 per cent, the lowest in almost 50 years.
Earlier this month, the
Commonwealth Bank of Australia raised its variable rate by 10 basis
points, blaming higher funding costs.
Australian
Bureau of Statistics data shows that more than 125,000 home owners fixed their mortgage rate into rates
of more than eight per cent in the 12 months to August 2008. Then rates fell 4 per cent, leaving the fixed rate home owners feeling trapped.