{"id":30498,"date":"2024-12-07T04:58:30","date_gmt":"2024-12-07T04:58:30","guid":{"rendered":"http:\/\/www.16news.com.au\/?p=30498"},"modified":"2024-12-07T04:58:30","modified_gmt":"2024-12-07T04:58:30","slug":"homekeeper-greens-election-plan-would-require-banks-to-offer-discount-low-rate-mortgages","status":"publish","type":"post","link":"http:\/\/www.16news.com.au\/index.php\/2024\/12\/07\/homekeeper-greens-election-plan-would-require-banks-to-offer-discount-low-rate-mortgages\/","title":{"rendered":"HomeKeeper: Greens Election Plan Would Require Banks To Offer Discount Low Rate Mortgages"},"content":{"rendered":"\n<p>The Australian Greens have today launched a plan to require the big banks to offer a discount mortgage called&nbsp;<strong>HomeKeeper<\/strong>&nbsp;to all homeowners, including first homebuyers and owner-occupiers.<\/p>\n\n\n\n<p>This would be delivered via legislating a cap on the profit a big bank can make on this mortgage product. The big banks could still offer other products and there would be no compulsion on anyone to switch to a&nbsp;<strong>HomeKeeper<\/strong>&nbsp;mortgage.<\/p>\n\n\n\n<p><strong>About HomeKeeper<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The Greens plan empowers the ACCC and APRA to together have the independent power to stop banks ripping people off, and ensure the big banks don\u2019t unnecessarily overcharge<\/li><li>HomeKeeper mortgages would be set at a regulated ceiling of no more than 1% above the cash rate. All of the big 5 banks would be required by regulations to offer HomeKeeper<\/li><li>This discount HomeKeeper mortgage would be available to any owner-occupier whether or not they are a first home buyer<\/li><li>People with a current mortgage on their home would be able to transfer into HomeKeeper at their own choice<\/li><li>HomeKeeper would not be available for investment property mortgages, commercial premises or holiday homes<\/li><li>Support would be provided to smaller banks so that they could offer a similar low-rate product without being financially disadvantaged<\/li><\/ul>\n\n\n\n<p><strong>Overview: bank profits on mortgages<\/strong><\/p>\n\n\n\n<p>For decades the major banks have made enormous profits price-gouging on people\u2019s mortgages, even when interest rates were low.<\/p>\n\n\n\n<p>According to modelling by The Australia Institute, big bank profits on the average home loan sit around&nbsp;<a href=\"https:\/\/australiainstitute.org.au\/report\/profit-in-home-lending\/\">$9,130 in the first year and $200,880 over the lifetime of a 30-year loan.<\/a><\/p>\n\n\n\n<p>The Australia Institute estimates that equates to $176 per week, or $761 a month of an average mortgage repayment is going directly to big bank profits.<\/p>\n\n\n\n<p>With the HomeKeeper mortgage, the interest rate would be 1% above the RBA cash rate, the big banks would make a more reasonable profit and mortgage-holders would have more in their pockets for other expenses.<\/p>\n\n\n\n<p>The current cash rate is 4.35%. The RBA lists the owner-occupier variable housing rates as 6.3% (new loans) and 6.4% (outstanding loans), giving a margin of 1.95% (new loans) and 2.05% (outstanding loans) above the cash rate.<sup>1&nbsp;<\/sup><\/p>\n\n\n\n<p>The latest average new mortgage size is $589,560,<sup>2<\/sup>&nbsp;meaning for a new mortgage holder, a reduction in their interest rate from 6.3% to 5.35% would be equivalent to almost four interest rate cuts by the RBA, with a saving of up to $357 per month, or up to $4,284 per year. For someone with an $800,000 mortgage, the cut of almost a percentage point would be equivalent to monthly savings of up to $484 and annual savings of up to $5,814.<\/p>\n\n\n\n<p><strong>Rates of mortgage stress<\/strong><\/p>\n\n\n\n<p>Almost 1.5 million Australians are&nbsp;<a href=\"https:\/\/www.roymorgan.com\/findings\/9748-mortgage-stress-risk-october-2024\">currently at risk of mortgage stress.&nbsp;<\/a>The number of Australians \u2018At Risk\u2019 of mortgage stress has increased by 680,000 since May 2022 when the RBA began a cycle of interest rate increases. Official interest rates are now at 4.35%, the<br>highest interest rates have been since December 2011, over a decade ago.<\/p>\n\n\n\n<p><strong>Comment attributable to Greens spokesperson for Treasury Senator Nick McKim<\/strong><\/p>\n\n\n\n<p>\u201cFor too long, big banks have been ripping people off by charging interest rates well above the cash rate.<\/p>\n\n\n\n<p>\u201cThe Big Four Banks are crushing mortgage holders. They are currently making billions of dollars in profits ripping off struggling mortgage holders by overcharging them on their mortgage.<\/p>\n\n\n\n<p>\u201dFor the average home loan, $761 per month is pure profit for the major banks.<\/p>\n\n\n\n<p>\u201cTo stop the price gouging and profiteering, the Australian Greens can today announce our new policy HomeKeeper: a discount mortgage for homeowners.<\/p>\n\n\n\n<p>\u201cThis policy will reduce the costs of mortgages for everyone by limiting the amount at which banks can rip people off.<\/p>\n\n\n\n<p>\u201cNo one should have to pay more than 1% over the current cash rate, it\u2019s immoral that people are being forced out of their homes while banks are making billions in profits.<\/p>\n\n\n\n<p>\u201cThis policy will stop big banks charging more than is absolutely necessary to provide a mortgage product to people struggling to keep a roof over their heads, and it will stop the Big Banks\u2019 super-profits made from mortgages.<\/p>\n\n\n\n<p>\u201cAfter the next election we\u2019ll almost certainly have a minority parliament and this is part of the Greens plan to work with Labor to help renters and people with mortgages.<\/p>\n\n\n\n<p>\u201cIf you want change, you have to vote for it, and the first step is to vote for someone who is fighting for you.\u201d<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><sup>1&nbsp;<\/sup>Reserve Bank of Australia,&nbsp;<a href=\"https:\/\/www.rba.gov.au\/statistics\/interest-rates\/\">Lenders&#8217; Interest Rates.<\/a><\/li><li><sup>2<\/sup>&nbsp;Australian Bureau of Statistics,&nbsp;<a href=\"https:\/\/www.rba.gov.au\/statistics\/interest-rates\/\">Lending Indicators,<\/a>&nbsp;September 2024.<\/li><\/ul>\n","protected":false},"excerpt":{"rendered":"<p>The Australian Greens have today launched a plan to require the big banks to offer a discount mortgage called&nbsp;HomeKeeper&nbsp;to all homeowners, including first homebuyers and owner-occupiers. This would be delivered via legislating a cap on the profit a big bank can make on this mortgage product. The big banks could still offer other products and &hellip; <a href=\"http:\/\/www.16news.com.au\/index.php\/2024\/12\/07\/homekeeper-greens-election-plan-would-require-banks-to-offer-discount-low-rate-mortgages\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;HomeKeeper: Greens Election Plan Would Require Banks To Offer Discount Low Rate Mortgages&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-30498","post","type-post","status-publish","format-standard","hentry","category-aussie"],"_links":{"self":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/30498","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/comments?post=30498"}],"version-history":[{"count":1,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/30498\/revisions"}],"predecessor-version":[{"id":30499,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/30498\/revisions\/30499"}],"wp:attachment":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/media?parent=30498"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/categories?post=30498"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/tags?post=30498"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}