What is a good home loan interest rate in Australia?

A "good" interest rate is one that is lower than the market average and competitive for your specific circumstances. As of September 2026, the average variable rate is 6.90%. A competitive or good rate would be anything significantly below that. This will depend on what kind of loan you need, how much deposit you have and your risk profile. The lowest rates are typically reserved for borrowers with large deposits (20% or more) and a strong credit history.

Why is my interest rate higher than the advertised rate?

Lenders often advertise their lowest possible "headline" rate, which may only be available to ideal applicants (e.g., owner-occupiers with a loan-to-value ratio of 60% or less). The rate you are offered depends on factors like your deposit size, your credit score, the loan purpose (owner-occupier vs investor) and the type of loan (principal and interest vs interest-only).

What will happen to interest rates in Australia?

Experts are often divided on future interest rate movements. The Reserve Bank of Australia (RBA) adjusts the official cash rate based on economic data, primarily inflation and employment figures. If inflation remains above the RBA's 2-3% target, rates are more likely to rise or stay high. If inflation falls and economic growth slows, the RBA may consider cutting rates. It is best to monitor the RBA's monthly statements and economic forecasts for the most current outlook.

How often do variable interest rates change?

A lender can change its variable interest rate at any time, but changes most commonly occur in the days following a change to the RBA's official cash rate. Some lenders may also adjust rates independently of the RBA to manage their funding costs or competitive position.