Out-of-Cycle Rate Cuts: 44 Lenders Now Under 6%

Lenders are cutting variable rates without waiting for the RBA, with 44 now competing below 6%. Here is what to do next.

The Reserve Bank hasn't moved since the last cash rate increase, but home loan lenders aren't waiting. Thirty lenders have now cut at least one new customer variable rate since the start of June, according to Australian Broker, with Macquarie Bank the latest to sharpen its pricing after trimming variable rates by 0.05% on 1 August.

The move was small but deliberate. Macquarie's lowest advertised variable rate now sits at 6.04%, placing it fractionally below Commonwealth Bank's equivalent offer — a calculated position from a lender growing its mortgage book at roughly double the pace of most major rivals.

What the Rate Landscape Looks Like Right Now

Competition across the lending market is increasingly visible in the numbers. At the start of June, 38 lenders were offering at least one variable rate below 6%. That figure has now climbed to 44. Meanwhile, the average variable rate for owner-occupiers paying principal and interest stands at 6.65%, meaning the gap between the market average and the sharpest available pricing is close to 1 percentage point.

This week, two lenders reduced a combined 11 owner-occupier and investor variable rates by an average of 0.06%. Unity Bank separately cut 12 owner-occupier and investor fixed rates by an average of 0.20%. The lowest variable rate currently available, across any loan-to-value ratio, is 5.69%, offered by LCU and Pacific Mortgage Group. Three rates in the market remain below 5.75%.

These cuts are happening out-of-cycle — driven not by an RBA decision but by lenders competing for market share in a period of softening demand. The next Monetary Policy Board meeting is on 11 August, and all four major bank economic teams are forecasting a hold at that meeting. However, market analysts note that sticky core inflation and the RBA's own stated possibility of further hikes mean borrowers should not assume the rate trajectory only points downward.

Who Is Growing — and Why That Creates Opportunity

APRA's latest monthly banking data confirms that despite a cooler property market, lenders are still expanding their books. The industry's total mortgage book grew 0.7% in June. Commonwealth Bank led in absolute terms, adding a record $5 billion to its residential mortgage book — its largest single-month increase in APRA's dataset — bringing its total housing loan book to $635.5 billion.

Macquarie Bank continued to post the fastest percentage growth among the top 10 lenders. Its housing book jumped $3.39 billion (1.88%) in June to $183.7 billion. APRA data shows Macquarie grew 2.03% in April and 2.1% in March, underpinning year-on-year expansion above 25%. Among the other majors, Westpac's book increased to $517.6 billion, NAB reached $351.5 billion, and ANZ climbed to $330.9 billion. ING has been consistently growing at roughly double the pace of the larger banks.

This growth matters for borrowers because it explains why the rate cuts are happening at all. Macquarie, ING, and other challengers are pricing aggressively because winning new mortgage customers is commercially valuable. The competitive tension between lenders is real, and borrowers who have not revisited their rate recently are likely sitting on a worse deal than what the market now offers.

What This Means for Your Home Loan

The pattern of out-of-cycle cuts creates a tangible opportunity, particularly for borrowers who are currently paying the market average rate or above. A gap of nearly 1 percentage point between the average variable rate and the most competitive offers available is meaningful when compounded over the remaining life of a loan.

If your current rate has a seven in front of it — or even a high six — it is worth asking your lender for a retention offer, or exploring what alternatives exist across the market. Lenders actively competing for new business will often sharpen their pricing for borrowers who ask, and for those whose financial position has strengthened since their original loan was taken out, the case for refinancing may be compelling.

Use our refinance savings calculator to estimate what moving to a more competitive rate could save each month. Our home loan refinance comparison lists current offers across the market, and the cheapest home loans page tracks the sharpest variable and fixed rates available right now.

The key message from the current market is simple: lenders are competing hard for your business, and there are now more options below 6% than at any point since June. That competition benefits borrowers who are willing to ask for better terms — or switch to a lender that genuinely wants them.