August home loan snapshot: As interest rates climb the pressure mounts on home owners

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The Reserve Bank of Australia (RBA) increased the official cash rate for the third time last month and economists predict there’ll be another 0.50% increase in August.

Several experts from NAB and Westpac predict we will continue to see hikes until February 2023, with a predicted 3.35% cash rate peak.

For now, rates continue rising across the board, and many homeowners at the end of their fixed rate terms are entering a home loan market with no more rates below a ‘2’. In fact, the RBA’s deputy governor warned that homeowners rolling from fixed to variable rates might see a 40% increase in their mortgage repayments.

While that might sound discouraging for those with home loans, the RBA says most households should be able to withstand higher repayments

On the other hand, those looking to become new homeowners might be surprised as recent Corelogic data found that property prices have sharply fallen in the last month.

The report says there was a 1.2% decrease in property prices nationwide. Sydney prices–the most expensive in Australia–dropped by 1.9% over the past four weeks. The last time it dropped this rapidly was more than 40 years ago. Melbourne also dropped by 1.2% and Brisbane by 0.6% over the same period.  

So what do variable rates and fixed rates look like after the RBA hike? Find out below.

The fall of the ultra low fixed home loan rates

The age of ultra low fixed rates is gone. Last year, several fixed rates started with a ‘1’, but now the lowest fixed rates in our database start with a ‘3’.

According to Mozo’s database, the average fixed rates for owner occupiers with an 80% LVR and a $400,000 loan are:

  • 1-year - 4.80% p.a.
  • 2-year - 5.40% p.a.
  • 3-year - 5.75% p.a.
  • 4-year - 6.12% p.a.
  • 5-year - 6.26% p.a.

“Fixed rates are basically out of the market now,” says Mozo’s banking expert Peter Marshall. “They’re going to settle in the area which they are now, which is the 5% - 8% range depending on the term.”

The graph below shows that fixed rates skyrocketed at the start of 2022 and have not slowed down. One can only assume that we won’t see a drop soon.

Recent fixed and variable interest rate movements

We’ve seen increases across all the home loan products in our database. In fact, in the last month, there were 1771 increases in variable home loan products and 2988 in fixed home loan products tracked in the Mozo database. Many of the variable home loan interest rate hikes were in line with the RBA’s new cash rate.

Here are some notable changes from the last month.

Variable home loans

  • Bank of Queensland increased its Economy Variable loan to 40bp for owner occupiers and 45bp for investors. 
  • Yard rates are up 64 to 104bp based on borrower type, now starting at 3.34% (3.38% comp rate*).

Fixed rate home loans

  • Suncorp passed large increases. Rates are higher by between 145 and 167bp for 1 year, 121 to 141bp for 2 years, 105 to 127bp for 3 years, and 91 to 112bp for 5 years. 
  • Westpac increased most 1 year rates between 50 and 60bp, 2 year rates by 40 to 60bp, 3 year rates by 30 to 60bp, 4 year rates by 40 or 50bp, and 5 year rates by 50 or 60bp. 
  • NAB increased all fixed options. For owner occupiers making P&I repayments rates are up 170bp for 1 year, 115 to 130bp for 2 years and 135bp for 3 years. 4 and 5 years are up by 120bp.

Lowest home loan rates

Even though the interest rate averages for home loans have gone up, there are still a few variable rates below a ‘3’ in the Mozo database and fixed rates that start with a ‘3’. Below are the lowest variable and fixed mortgage rates (P&I, LVR <80%) among lenders we track.

Lowest variable rates — Mozo database (August 1, 2022)^^

LenderLoanVariable rate
Homeloans 360Owner Variable Home Loan (Plus, LVR 60-80%)2.54% p.a ( 2.54% p.a. comparison rate*)
Police Credit UnionThe Better Home Loan Special Offer (Owner Occupier, Principal & Interest, LVR<80%)2.64% p.a ( 2.69% p.a. comparison rate*)
Australian Mutual BankBasic Variable Rate Home Loan (Owner Occupier)2.69% p.a ( 2.75% p.a. comparison rate*)
Australian Mutual BankFirst Home Buyers Basic Variable Rate (Up to 40 Year Term)2.69% p.a ( 2.70% p.a. comparison rate*)
Australian Mutual BankFirst Home Buyers Loan2.79% p.a ( 2.67% p.a. comparison rate*)

Lowest and average fixed rates — Mozo database (August 1, 2022)^^

TermRate leaderFixed rate
1-yearSouthern Cross Credit Union3.89% p.a. (3.43% p.a. comparison rate*)
2-yearQueensland Country Bank3.99% p.a. (4.87% p.a. comparison rate*)
3-yearQueensland Country Bank3.99% p.a. (4.80% p.a. comparison rate*)
4-yearSouthern Cross Credit Union5.29% p.a. (4.06% p.a. comparison rate*)
5-yearAMP Bank5.44% p.a. (4.65% p.a. comparison rate*)

These are the lowest rates available in our database for borrowers with an <80% LVR. More competitive rates are available for borrowers with LVRs below 70% and 60%.

Are you thinking about a property or looking to refinance your existing mortgage? Use Mozo’s handy home loan comparison table to examine lenders side-by-side, or use our refinance calculator to see how much you could save.

^^Interest rates are based on an owner occupier making principal and interest repayments on a $400,000 loan with an 80% LVR. Check out our dedicated Australian home loan statistics page for more information on average mortgage rates.

Loan details

Rate change

Repayment change if rates go up

Home loan comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can compare more home loans here.
Last updated 24 July 2024 Important disclosures and comparison rate warning*
  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Neat Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    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.

  • Special Real Deal Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.13 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.

  • Optimum Fixed Rate Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.69 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,899
    Go to site

    Lock in a competitive interest rate and enjoy peace of mind for the fixed period. Available for owner occupied new and refinanced home loans with at least 20% deposit. Split option available as well as offset and redraw. Noapplication, ongoing or banking fees. Third Party fees may be applicable - payable within loan repayments. Extra repayments up to $20K per annum permitted. Apply online, 100% member owned credit union.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • OMG Home Loan

    • Owner Occupier
    • Principal & Interest
    • <60% LVR
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    6.02 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    BCU Bank’s OMG owner occupied home loan offers a variety of great low rates depending on your deposit. Save with no ongoing annual fees. Access your extra payments when you need to through the redraw facility. Pre-approval valid for 3 months.

  • Flex Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.99 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Competitive Fixed rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

  • Express Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <90%
    Interest rate
    6.01 % p.a.
    Variable
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $3,001
    Go to site

    Get 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.

  • Neat Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    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.

  • Special Real Deal Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.13 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Flex Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.38 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Competitive variable rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    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.

  • Basic Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR<70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $10,000,000.

  • Offset Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.42 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.54 % p.a.
    Fixed 2 years
    Comparison rate
    7.10 % p.a.
    Initial monthly repayment
    $3,174

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

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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.

^See information about the Mozo Experts Choice Home Loan Awards

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