Qantas has swooped into the home loan market in a move likely to draw in travel-hungry mortgagers.
The Qantas Money Home Loan isn’t entirely out of character given Qantas previously had a partnership with Macquarie Bank, although Macquarie Bank stopped accepting new customers for its Qantas Frequent Flyer Home Loans in 2022.
With more interest rate hikes predicted to be on the way, those looking to buy a home or refinance will be keeping their eyes peeled for the best deals on the table.
But just because Qantas’ offering is new, doesn’t mean it’s any better than the rest of the market, Experity director Clint Howen told TND.
What is the offer?
Qantas Money Home Loan is currently offering a variable interest rate of 4.67 per cent with a minimum 10 per cent deposit.
Its one-year fixed rate is 5.23 per cent, and the two-year fixed rate is 5.39 per cent for owner-occupiers.
Rates are higher for investors, with a variable offering of 5.02 per cent, one-year fixed is 5.54 per cent and two-year fixed is 5.59 per cent.
All of these home loans require a minimum 10 per cent deposit.
The variable rate allows an unspecified amount of additional repayments while the fixed rates only allow up to $20,000 of additional repayments per year.
Overall, compared to the rest of the home loan market, these interest rates are nothing special.
Mr Howen said that’s to be expected given that Qantas Money Home Loan is essentially a white label product; the airline has partnered with the Bendigo and Adelaide Bank to deliver its loans.
Qantas Money Home Loan’s variable rates appear to be slightly lower than Bendigo and Adelaide Bank at this point, but the fixed rates are higher.
Mr Howen said the real point of difference lies in the Frequent Flyer points Qantas’ home loan customers will receive.
To be eligible for a Qantas Money Home Loan, you must already be a Frequent Flyer member; if the loan is going to be shared among two people, you’ll both need to be (or intend to be) Frequent Flyer members.
Every home loan customer will receive 100,000 Frequent Flyer points every year.
Qantas says 63,000 points (plus $338 in taxes and carrier charges) could give a single person a return flight from Sydney to Honolulu, and 96,000 points (plus $360 in taxes and carrier charges) could give a family of four a return flight from Sydney to Hobart.
What’s in it for Qantas?
With the PR nightmare that was 2022 not far behind the airline, one might question why Qantas would want to add more to its plate by entering the home loan market.
Mr Howen said the decision would have come down to leveraging Qantas’ well-known and traditionally well-respected brand after having already dipped its toes into the finance world via its credit card and insurance offerings.
“They’re just seeing it as an extension of some of those services they already provide,” he said.
“It’s really just like an extension of their brand and using it to try and generate more revenue.”
Is it a good option?
For mortgage holders in general, the best thing Qantas has brought into the home loan market is more competition.
“Like anything, if it’s well priced and it’s a good offer then that creates more competition in the market, and more competition is always better,” Mr Howen said.
But the product is probably aimed at, and best suited to, travel lovers.
“If someone’s a frequent traveller, [the 100,000 Frequent Flyer points is] an offer that’s going to attract,” he said.
“Someone like myself – I’m a new dad, not really planning to go to do all that much travelling – I would look for something else that might attract me.”
