In a historically rare event, three-year fixed interest rates are about the same as variable rates, which is good news for embattled budget-conscious first-home buyers.

Many prospective buyers have been holding back because they fear monthly mortgage repayments will rise when household expenses are going up. Yet with three-year fixed rates at about 7.36 per cent on average, this gives first-home buyers, who have deserted the market, certainty in repayments in the early years of their home loan.  The three-year fixed rate mortgages, relative to variable rate mortgages, are the lowest they have been since October 2009, something which is historically rare.

Drawing on data from the Bureau of Statistics, there were about 60,000 fewer first-home buyers in the year to May 2011 compared to the year to May 2010. Some reasons for the low number include the ''pull-forward'' of first timers into the market in 2009-10 because of the government's First Home Owners Boost, as well as higher interest rates and low consumer confidence.

Although home owners were spared from an interest rate rise yesterday, most economists maintain the Reserve Bank will have to raise interest rates to contain inflation induced by the mining boom.

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