With interest rates low, Australian banks are competing with each other for mortgage customers. Adelaide Bank announced today it will reduce the interest on all variable rate home loans for new business by 0.20 basis points, effective April 14. The bank also announced it will further waive ongoing monthly fees on its SmartFit home loan for new business, representing a saving of $180 per year for customers in ongoing administration fees.

"Our fully featured SmartFit variable rate home loan, with 100% offset is now 4.44% with no ongoing monthly fees for new customers with an LVR of less than 90%," said Damian Percy, General Manager Adelaide Bank. “It’s a hugely competitive mortgage market at the moment, which is great news for borrowers and Adelaide Bank have recognised that we need to move closer to the front of the field."

Percy said the December Quarter 2014 edition of the Adelaide Bank/REIA Housing Affordability Report found that the Australian weighted average median house price is now $645,000 and the average loan size to First Home Buyers increased by 3.5% over the December quarter to $327,767.