Home loan borrowers are being hit with higher interest rates, despite the Reserve Bank (RBA) opting to keep the cash rate on hold at 4.10 per cent.
Almost half of lenders had hiked their variable interest rates since July’s cash rate pause, Canstar research found, with an average increase of 0.15 per cent.
Fixed rates are also on the up, with 81 per cent of lenders increasing fixed rates by an average of 0.27 per cent. Shorter fixed-rate terms of between one and two years experienced the greatest number of hikes.
Canstar editor-at-large and money expert Effie Zahos said lenders weren’t waiting for official cash rate movements to adjust their home loan rates, as they attempted to “claw back profit margins”.
“The fact that lenders are moving interest rates outside of official cash rate hikes should serve as a reminder for borrowers to review their home loan,” Zahos said.
“It’s important not to be complacent simply because the cash rate has been on hold. Homeowners need to make sure they are still on the sharpest rate.”
Zahos also warned homeowners to be prepared for the fact that we may not see any rate cuts for “quite some time”.
Lowest home loan rates
Aussies with a $500,000 loan have seen their monthly repayments rise to $3,320 since April 2022 - an increase of $1,217 a month.
One way to claw back some cash could be by refinancing to a lower home loan rate. Canstar still has 124 fixed and variable rate home loans with rates below 5.75 per cent on its database.
This is nearly 1 per cent below the average variable rate of 6.67 per cent. Just over half of these (58 per cent) are variable rates.