After months dominated by new customer rate cuts, the mortgage market showed signs of turning last week, according to Canstar's latest weekly rate wrap-up.
Just two lenders cut a combined seven owner-occupier and investor variable rates, trimming them by an average of 0.12%, while three lenders moved in the opposite direction, lifting five variable rates by an average of 0.09%.
The average variable rate for owner-occupiers paying principal and interest now sits at 6.62%, with Pacific Mortgage Group still holding the lowest rate on Canstar's database at 5.69%. Only two rates across the entire database now sit below 5.75%.
Canstar data insights director Sally Tindall (pictured) said the shift was notable given the broader trend of recent months.
"While the home lending market has been focused on new customer variable rate cuts over the last three months, last week was noticeably different with just two lenders cutting new customer variable rates. Meanwhile, three lenders hiked," Tindall said.
The rate movement comes as broader lending data points to a market losing momentum.
Tindall noted that APRA's latest monthly figures show home loan growth slowing to just 0.2% in July — the weakest result in three years.
"You have to trace the data back to July 2023, towards the end of one of the RBA's steepest rate hiking cycles, to find a month this quiet," she said.
Tindall pointed to "the double-whammy of three RBA rate hikes in 2026, alongside the federal government's property tax overhaul," which she said "has clearly left the banks largely treading water, with NAB going backwards for the first time since July 2024."
For brokers watching where variable rates go next, the bigger question is whether last week's shift in lender behaviour marks a genuine turning point. Tindall pointed to fresh inflation figures showing core inflation stagnant, alongside the RBA's August board minutes reiterating it would act if inflation didn't track to forecast.
"Certainly, three of the big four banks' economic teams have done an about-turn, reverting back to a prediction of at least one more rate hike," she said. "It's therefore not surprising to see a few variable rates do the same, despite the pressure on lenders to bring in new business."
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