The Maximum Permissible Interest Rate (MPIR) – the interest rate that aged care residents pay on their accommodation bonds – has been increased to 7.46% for the period 1 April 2023 to 30 June 2023.
This is the highest the MPIR has been since December 2012, when it was 7.62%. Since then, the MPIR dropped to a low of 4.01% in December 2021, and since then has been trending sharply higher.
The higher interest rate could mean incoming residents are more likely to choose a Refundable Accommodation Deposit over Daily Accommodation Payments, because the RAD is achieving a more attractive return.
The highest MPIR occurred in July 2008, when it soared to 11.75%.
