A November rate hike for home loans could happen

Woman nervous about a November rate hike.

Since the last Reserve Bank rate hike in July 2023, the interest rate hold has been looking more and more certain. The prevailing thought is that the current cash rate of 4.10% is high enough to work its magic, slowing inflation without plunging the economy into a recession. 

However, the latest Consumer Price Index data from the ABS has thrown matters into question. Quarterly, inflation is down from 6.0% to 5.4% in the year to September, but the more volatile monthly CPI has increased for the third month in a row. So is inflation really declining?

“While many industries' price increases are slowing, automotive fuel has had large annual increases in the last two months, which has been driving the movement higher,” explains ABS head of prices statistics Michelle Marquardt.

It’s enough to make expert economists nervous. Even three of the Big Four Banks – CommBank, Westpac, and ANZ – have revised their interest rate forecasts. While before they were certain rates had peaked at 4.10%, their official stance now is that the RBA will make one more rate hike of 0.25% in November, pushing the cash rate to 4.35%. NAB had already predicted this for a while, now. 

CommBank, in particular, has been one of the most reliable predictors of cash rate movements. There’s also plenty of solid evidence from the RBA itself. Governor Michele Bullock has maintained public confidence that if inflation continues to stagnate – or worse, increase – the central bank will tighten its monetary policy and hit the cash rate with another hike. 

Such a move would inevitably flow through to home loans, particularly those on variable or ‘floating’ interest rates that rise with the inflationary tide. 

The current interest rate hold has somewhat relieved home loan borrowers. While individual lenders have made little adjustments – both hikes or cuts – the average variable interest rate for owner-occupied home loans has hovered around 6.61% in the Mozo database for the last three months, at least. If the RBA hikes again, we can safely expect this to climb. 

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Compare low interest rate home loans in the table below.

Compare low rate home loans - last updated 18 April 2024

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  • Offset Home Loan

    Package, Owner Occupier, LVR<60%, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    6.15% p.a. variable
    6.40% p.a.

    Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.

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  • Mozo Expert Choice Badge
    Express Home Loan

    Owner Occupier, Principal & Interest, LVR <90%

    interest rate
    comparison rate
    Initial monthly repayment
    6.01% p.a. variable
    6.14% p.a.

    Get fast online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.

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  • Neat Home Loan

    Owner Occupier, Principal & Interest, LVR <60%

    interest rate
    comparison rate
    Initial monthly repayment
    6.14% p.a. variable
    6.16% p.a.

    Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.

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  • Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    5.99% p.a.
    fixed 3 years
    6.13% p.a.

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

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