CBA Lifts Fixed Rates 0.48pp as Banks Front-Run the RBA
Ten lenders lifted 266 fixed rates in the past week, with CBA's two-year fixed now at 6.82%. Here's what the repricing wave means for your loan strategy.
The Fixed Rate Market Is Pricing In More Hikes
With the RBA's September meeting just days away, lenders have not waited for the board's decision before acting. Australian Broker reports that CBA lifted its fixed home loan rates for new owner-occupier and investor customers by up to 0.48 percentage points this week — a move nearly double the size of a standard RBA cash rate increase, landing seven days before the next RBA decision.
CBA's two-year fixed rate rose from 6.34 per cent to 6.82 per cent, the largest increase across its fixed terms. The one-year rate now sits at 6.78 per cent and the five-year at 6.94 per cent. Other fixed terms rose between 0.15 and 0.30 percentage points.
That follows moves from Westpac, NAB, and ANZ in the prior week of up to 0.20 percentage points, with Westpac pushing some of its fixed rates above 7 per cent. Across the broader market, MPA Australia reports that 10 lenders have lifted 266 owner-occupier and investor fixed rates by an average of 0.33 per cent in the past week alone.
The message from the lending market is clear: lenders believe the cash rate is heading higher and they are adjusting pricing now, ahead of the RBA's 28–29 September monetary policy board meeting.
What the Numbers Mean for Borrowers
Among the major banks, ANZ offers the most competitive fixed rate at 6.49 per cent on both one- and two-year terms, with NAB matching that on the two-year. Outside the majors, seven lenders still have at least one owner-occupier fixed rate starting with a 5, including Police Credit Union at 5.79 per cent on the one-year term. One variable rate of 5.69 per cent from Pacific Mortgage Group sits at the lower end of the market. The average variable rate for owner-occupiers paying principal and interest now sits at 6.61 per cent.
MPA Australia reports that analysis of a $600,000 mortgage with 25 years remaining puts each additional 25 basis point hike at roughly $91 a month in extra repayments — a cumulative $364 a month across four hikes from a lower base, or $606 a month on a $1,000,000 loan. If ANZ's two-hike forecast for September and November materialises, borrowers on variable rates with a $600,000 loan could be looking at around $182 a month more than today's repayments.
For borrowers on fixed terms rolling off in the coming months, this repricing has a direct impact. If you locked in a two-year fixed rate in late 2024, you are likely stepping off a rate that started with a 5 into an environment where big four fixed rates start at 6.49 per cent — a significant reset regardless of what the RBA does next week.
Fixed or Variable: What Should You Do Now?
It is tempting in this environment to lock in a fixed rate to insulate against further increases, but the decision needs careful analysis. A borrower fixing at CBA's 6.82 per cent two-year rate versus staying on a major bank variable rate near 5.99–6.25 per cent would need rates to rise materially and stay elevated for the fixed term to pay off. If the RBA begins cutting from mid-2027 as some banks forecast, a two-year fix entered today could lock you out of that relief cycle.
For rate-sensitive borrowers, the smaller lender market is worth exploring. With seven lenders still pricing owner-occupier fixed rates under 6 per cent and one variable offer below 5.75 per cent, there is a meaningful gap between what the major banks are offering and what is available elsewhere. Visit our cheapest home loans page for the full picture across the market.
For investors, the repricing also affects serviceability assessments and cash flow projections. If you are actively managing investment properties, revisit the numbers now — what looked serviceable at 4.35 per cent may look different at 4.60 or 4.85. Our investor home loans hub covers the current landscape for investment borrowers specifically.
Before making any decision, use our repayment calculator to model your specific loan balance and remaining term against current fixed and variable options. The right answer depends on your circumstances, not just the headline rate.