Home Loan Rates Australia 2026

Home loan rates in Australia — what you need to know

Australian home loan rates are influenced primarily by the Reserve Bank of Australia's (RBA) cash rate, the wholesale funding costs of banks, and competitive pressures. As of early 2026, the RBA has begun easing rates after the 2022–23 tightening cycle, which means variable rate borrowers are starting to see some relief.

Variable rates for owner-occupiers typically range from 5.8% to 6.8%, depending on the lender and loan features. Fixed rates range from approximately 5.5% to 6.5% for 1–3 year terms. Online lenders and smaller banks often undercut the big four (CBA, ANZ, NAB, Westpac) by 0.3–0.8%.

Use our mortgage repayment calculator to see exactly what different rates mean for your monthly repayments. Even a 0.5% difference on a $600,000 loan saves approximately $190/month and over $68,000 in total interest.

Fixed vs variable home loan rates

Variable rates move with the RBA cash rate. When the RBA cuts, your repayments drop (usually within weeks). When it raises, your repayments increase. About 80% of Australian borrowers choose variable because of the flexibility: unlimited extra repayments, offset accounts, and no break costs.

Fixed rates lock in your rate for a set period (usually 1–5 years). You get repayment certainty, but the trade-offs include restricted extra repayments (usually capped at $10,000–$20,000/year), no offset account on most products, and break costs if you refinance or sell early.

Split loans combine both — fix a portion for certainty, keep the rest variable for flexibility. Many borrowers use a 50/50 or 60/40 split.

To see how rate changes affect your repayments, use our rate rise impact calculator.

How the RBA cash rate affects your mortgage

The RBA meets roughly every 6 weeks to set the official cash rate. When the cash rate changes, most variable rate lenders adjust their rates by a similar amount within days or weeks.

A 0.25% increase on a $600,000 mortgage adds roughly $95 to your monthly repayments. Over the 2022–23 tightening cycle, rates rose by 4.25 percentage points — adding over $1,600/month to repayments on that same loan. The RBA began cutting in late 2024/early 2025, providing gradual relief.

Fixed rate borrowers are insulated during their fixed term, but face a "rate cliff" when the fixed period ends and they revert to the (often higher) variable rate.

What to look for when comparing home loan rates

• Comparison rate: Includes fees and charges, giving a truer cost picture. Lenders must display it alongside the advertised rate.
• Offset account: A 100% offset account reduces the interest charged on your loan. A $50,000 offset on a $600,000 loan at 6% saves ~$3,000/year in interest.
• Extra repayment flexibility: Check whether you can make unlimited extra repayments without penalty. This is standard on variable loans but restricted on fixed.
• Ongoing fees: Some loans have annual or monthly package fees ($300–$400/year). These can be worthwhile if the rate discount is large enough.
• Cashback offers: Some lenders offer $2,000–$4,000 cashback for refinancing. Factor this into your comparison, but don't let it overshadow a higher long-term rate.