Repricing gets underway following RBA's 25-basis-point cash rate hike
Numerous banking majors have announced increases to their fixed home loan rates following the Reserave Bank of Australia (RBA)'s decision to increase the cash rate by 25 basis points to 3.85% on Tuesday.
Westpac will pass through the 25bps hike on owner-occupier and investment loans from 17 February.
Commonwealth Bank will increase its variable home loan rates, including on its Digi Home Loan, Simple Home Loan and Standard Variable Rate by 25bps frpm 13 February.
ANZ will increase its variable home loan rates, including on its ANZ Standard Variable Home Loan Index Rate and ANZ Standard Variable Residential Investment Property Loan Index Rate products, by 25bps on 143 February.
Macquarie Bank will increase its variable home loan rates by 25bps from 20 February, while NAB will increase variable rates from 13 February.
"With rates now on the rise, we want to help our home loan customers adjust to the higher interest rate environment, so we’ve decided to wait until 20 February before passing through this rate increase," said Macquarie's head of personal banking Ben Perham.
Perham added: "The lending market remains very competitive for borrowers, and after a year of falling rates, this move by the RBA may be a wake-up call for those who have been considering switching their loan to another bank. If you’re refinancing or just entering the market, speak to your broker to understand what options out there are best for you.”
Following yesterday's cash rate hike, Anja Pannek, chief executive of the Mortgage and Finance Association of Australia (MFAA), surmised that an average household mortgage of $694,000 will see an extra $109 in monthly repayments, "which will be felt most by borrowers who reduced repayments during the last easing cycle".
Mortgage experts inlcuding Mortgage Choice chief executive Anthony Waldron and Peter White, managing director of the Finance Brokers Association of Australia, have urged brokers to guide clients through the incoming repricing.
“If buying your first or next home is part of your plans for 2026, a rate hike will likely have an immediate impact on your borrowing power,” he said. “If you secured home loan pre-approval in the last couple of months, check in with your broker because you might not qualify for the same amount today," said Waldron.
