Finder makes money from featured partners, but editorial opinions are our own.

RBA offers Christmas relief as it holds cash rate


After 13 rate rises in 18 months, borrowers can take a breath as the RBA hits the brakes on rate rises.

Home loan borrowers have been given the gift of another rate pause this Christmas, after November saw more mortgage pain.

The Reserve Bank of Australia (RBA) announced that the cash rate would remain at 4.35% until at least February - the RBA does not meet in January. This follows the 13th rate rise in 18 months in November.

The latest hold is only the 5th since May last year, when the board began its attack on rising inflation. Monthly inflation slowed in October according to the most recent statistics, giving way to the RBA's decision.

First home loan values reach record high

Although rates are staying where they are for now, rising house prices mean that for a new borrower entering the market, things are still getting worse.

The average home loan for first home buyers was a record high of $506,046 in September. According to RBA figures, the average interest rate for new loans in September is 6%. Assuming a 30 year loan term, this would mean the average monthly repayment for a first home buyer is $3,035.

A year before, the average interest rate for a new loan was 4.38% and the average loan amount was $488,052. This would have meant a $2,439 monthly repayment – $596 less than what first home buyers are paying this year.

With rising rates and house prices, the unaffordability of housing is a concern. Even ANZ CEO Shayne Elliott has said that owning a home is becoming the preserve of the rich.

The future of interest rates

69% of Finder's panel of economists are predicting that the cash rate will peak by March 2024, if it hasn't peaked already.

Inflation has been slow to drop, but with the latest monthly inflation figure from the ABS at 4.9%, that's much closer to the desired target range. Household spending also looks to have slowed, which should contribute to inflation slowing even more.

Factors overseas are also playing a role, with inflation in the UK and US dropping substantially.

Although we know that economic factors can change overnight, we will have to keep an eye on the market over the next 2 months before the next cash rate announcement.

If you are struggling with your home loan repayments now, then it might be time to refinance. If you're particularly stressed about your mortgage though, speak to your lender about your situation.

  • You can call the National Debt Helpline on 1800 007 007 for free financial counselling.

Ask a Question

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our 1. Terms Of Service and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site