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The Reserve Bank has not moved interest rates for almost a year, but that hasn't stopped banks slashing the cost of fixed rate mortgages.
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Borrowers can now lock in an interest rate of less than 5 per cent for up to five years, after Commonwealth Bank, National Australia Bank, Westpac all cut fixed rates last week. Standard variable rates are also close to or below 5 per cent once the discounts that banks give most customers are taken into account.
Without doubt, it is very cheap money. But how long can variable rates stay this low?
It would be extremely unusual for rates to remain at these levels for five years - which is the average lifespan for a mortgage before people sell their home, repay the loan, or refinance. If you'd like to make your repayments predictable, that can make fixing a good option.
However, taking out fixed-rate mortgage also involves some risks. So before rushing to lock in a rate, what should borrowers consider?
The big advantage of a fixed rate home loan is certainty. If your budget is tight and even a small rise in interest rates would be uncomfortable, fixing while rates are at record lows can make good sense.
The downside is that fixed loans are, by definition, more rigid.
Variable rate loans allow borrowers to make repayments ahead of schedule, for instance. This means you pay down your debt more quickly and pay less interest overall. Fixed rate loans generally don't allow this.
There can also be break costs if you change your mind and want to switch to a variable rate loan. But the good news is these would only apply if interest rates fell further - and any such movement would probably be small.
Finally, there the risk that rates fall even further.
"With a fixed rate you are betting against the bank that rates stay where they are," says RateCity's Peter Arnold.
Money markets reckon there's a 50-50 chance the Reserve Bank will cut the cash rate again. If you fix now you might miss out on these savings, if they eventuate.
But even if the Reserve Bank does cut interest rates again. it's unlikely to be a drastic reduction. Even the most pessimistic market economists are predicting a relatively small cut of 0.25 percentage points.
So if you're someone who wants certainty, the experts reckon now is probably a good time to lock in a competitive rate. If you like the sound of some certainty but also want to hedge your bets, an increasingly popular option is to fix part of the loan.