Households face tighter budgets as rising mortgage rates squeeze borrowing power
Mar 24, 2026
Households are bracing for fresh pressure as lenders reprice home loan rates after the latest Reserve Bank decision.
According to Canstar’s latest Weekly Rate Wrap-up, 10 lenders have already raised 87 owner-occupier and investor variable rates, with the increases averaging 0.23 percentage points. A further 28 lenders have lifted 582 fixed rates, with average rises of 0.34 percentage points.
For owner-occupiers paying principal and interest, Canstar’s data shows average variable mortgage rates are now in the low‑6% range, with the most competitive variable offers around one percentage point lower.
The number of rates below 5.5% on Canstar’s database has shrunk to just 83, tightening the field for first-home buyers and property investors seeking sharper deals.
Canstar.com.au data insights director Sally Tindall (pictured) said the industry reaction to RBA was swift.
“The RBA’s line ball vote to hike the cash rate might have been a close call but lenders have wasted no time announcing they’ll pass the hike on in full,” Tindall said.
Full hike flows through the market
Tindall noted that repricing is spreading quickly across the market.
“Canstar’s Rate Tracker shows around 50 lenders have already announced they’ll be passing on the full hike, although only a small portion of these have made these effective already,” she said.
While many customers will not feel the impact immediately, brokers can use the one to three months’ notice lenders typically give before revised minimum repayments start to help households prepare, bearing in mind that timing also depends on when the notice is issued and where borrowers fall in their billing cycle.
Some borrowers are still waiting to see the effect of the previous move in February, even as the latest changes roll through.
For clients weighing fixed versus variable mortgage rates, the options are narrowing.
Canstar notes that fixed pricing continues to climb in response to the higher cash rate, reducing the opportunity to lock in lower repayments for the next one to three years. At the same time, higher mortgage rates are feeding directly into serviceability calculations.
“Canstar.com.au analysis shows someone earning the average full-time wage of $106,950 will be able to borrow an estimated $12,000 less as a result of the March RBA rate increase and broadly double that across the two hikes we’ve had so far this year as they also tackle the second-highest cash rate setting we’ve had in the last 14 years,” Tindall said.