Variable home loan rates below 6% are expected to disappear within weeks, with all four major banks lifting their rates on Friday, 13 November, after the Reserve Bank of Australia’s (RBA) latest cash rate move, according to Canstar.
Canstar’s database now lists just four variable rates under 6%, down from eight a week earlier. Each of those offers comes from a lender that has yet to adjust its new-customer rates.
The average variable rate for owner-occupiers paying principal and interest now stands at 6.86%. The lowest variable rate on Canstar’s database for any loan-to-value ratio (LVR) is 5.93%, offered by Southern Cross Credit Union.
“In terms of the lowest rates, we expect rates starting with a ‘5’ will be relegated to the history books in a matter of weeks,” said Sally Tindall (pictured), Canstar’s data insights director.
Last week, seven lenders lifted 55 owner-occupier and investor variable rates, while six lenders raised 130 fixed rates, both by an average of 0.25 percentage points.
Most lenders have yet to pass on the hike. However, of the 54 lenders on the Canstar Rate Tracker that have announced their response, 35 will have new rates in place by Friday.
“Every one of them is lifting by 0.25,” Tindall said.
Once the big four lift rates on Friday, almost all of their advertised variable rates will sit above 6.50%. Westpac is the only exception, sitting one basis point below that level.
There’s a lag before borrowers feel the increase. Lenders’ standard notice periods give customers time to prepare, which Tindall said some households may need this time, and many won’t see higher repayments until early 2027.
Refinancers urged to check rates
For borrowers looking to refinance, Tindall warned that advertised rates may not yet reflect the latest hike during this transition period. She advised anyone unsure whether a rate is current to contact the lender directly.
“Looking at a pre-November-hike rate, unaware that it’s about to rise, is not a mistake you want to be making when you are going to the trouble of refinancing,” she said.
For brokers, the message is clear: confirm a lender has repriced before presenting comparison rates to clients.
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