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Current home loan interest rates in Australia

Home loan interest rates in Australia are rising fast. But there's a huge gap between the market average and the lowest rates on offer. Compare current rates from as low as 5.8%.

Average Australian interest rates versus the market's lowest rates

Australian interest rates March 2024Data
Average variable mortgage interest rate7.26%
Lowest variable rate available on Finder*5.69%
Average fixed mortgage interest rate6.66%
Lowest fixed rate available on Finder*5.48%

*Lowest rates listed above are based on products from lenders with whom Finder has a commercial partnership.

Where does this data come from?

Finder maintains a home loan database that includes thousands of interest rates from lenders big and small. Our data covers the majority of the home loan market.

Our average interest rate figures are updated monthly. To get the average variable rate figure we take the average of all interest rates for loans that:

  • Are for owner-occupiers
  • Have principal-and-interest repayments
  • Have maximum insured LVRs of 80% or higher (available for borrowers with at least 20% deposits)

This ensures our average rates reflect the types of loans that the average borrower would actually need.

If you want the current rates for different home loan types, check out the following pages:

How home loan interest rates have changed over time

The graph below shows the lowest rate on the market each month. It's a helpful way to see just how much you can save by comparing interest rates.

If you just want to see the cheapest loans, check out our lowest home loan rates page.

Check out more detailed mortgage data on our home loans statistics page

What determines Australian interest rates?

Interest rates affect how much it costs to borrow money (and how much you can earn on money in your savings account).

Various factors combine to determine how high or low interest rates are at any time.

The Reserve Bank of Australia

Australia's Reserve Bank determines certain interest rate settings, including the official cash rate target. This is a benchmark interest rate that effects the cost of borrowing money.

When the cash rate increases, lenders pass on their higher costs to borrowers. When the cash rate falls, lenders drop rates.

The RBA determines the cash rate based on multiple factors.

  • The economy. If economic growth is slow, lower interest rates can boost the economy by encouraging borrowing and spending. If the economy is booming but policy makers are worried about inflation or debt bubbles, increasing rates can help cool things down.
  • Inflation. When inflation is high (prices for goods are rising), the Reserve Bank may increase interest rates to decrease the supply of money and drive spending down. This helps curb inflation.
  • The US Federal Reserve. Large economies like the US have big effects on smaller markets like Australia. If the US Federal Reserve (America's version of the RBA) moves interest rates up or down, Australia is likely to follow to some degree.

Lenders have a lot of flexibility in setting their rates

While the Reserve Bank sets the floor for certain interest rates, banks and lenders have a lot of flexibility to price interest rates themselves. Some lenders may drop rates to entice new customers. Others may feel that they can keep customers while lifting rates.

Rising costs

What's happening with Australian interest rates?

Home loan interest rates began rising rapidly in 2022 when the Reserve Bank of Australia lifted the cash rate 8 times in 8 months. There were 5 rate rises in 2023.

As interest rates rise, home loan repayments increase. And this means shopping around for a lower rate can save you more than ever.

You can ask your lender to put you on a more competitive rate. And if that doesn't work, then compare home loans and look for a better deal.

How much difference does a higher or lower interest rate make?

Even a slight variation in interest rates can make thousands of dollars of difference over the life of a home loan. For example, let’s consider 2 otherwise identical home loans with principal-and interest-repayments and 30-year loan terms. The only difference is a 50 basis point difference in the rate.

Loan ALoan B
Interest rate6.00% p.a.6.50% p.a.
Loan amount$500,000$500,000
Monthly repayment amount$2,998$3,161
Total cost of loan$1,079,191$1,137,723
Total interest paid$579,191$637,723
Saving on cheaper loan$58,532N/A

As you can see, the lower interest rate of Loan A results in a saving of more than $58,000 over 30 years.

Use our home loan repayment calculator to see how a higher or lower interest rate could affect your mortgage repayments.

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Frequently asked questions about home loan interest rates in Australia

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4 Responses

    Default Gravatar
    amandaJuly 6, 2022

    my son an Australian citizen would be a first-time buyer in Australia, and we are researching the best time to buy looking at interest rates and property prices etc, he is open to all areas as he is a postman and his job is transferable
    Any help will be great.

    thank you

      AvatarFinder
      RichardJuly 8, 2022Finder

      Hello Amanda,

      Unfortunately at Finder, we can’t provide personal guidance around where to buy or market timing. It really depends on each individual’s goals and plans.

      Whatever you decide, I do suggest factoring in interest rate rises. Calculate your monthly mortgage repayments with a 3% interest rate. And then see how expensive repayments get with a 5% rate. It’s a good affordability test.

      Good luck,
      Richard

    Default Gravatar
    AllanMay 31, 2019

    Hi, I have a mortgage of $90,000 remaining could I change to another bank with this amount. I have a variable interest rate and receive a discount of 1.12% my rate being 4.15%. I would like to transfer to a bank with a more competitive rate.
    Thank you.

      Default Gravatar
      NikkiJune 1, 2019

      Hi Allan,

      Thanks for your inquiry.

      Yes, you can change your mortgage to get better rates by doing a refinance home loan. On the page you’ll find:

      • a table that lists out the brands offering refinancing
      • benefits of refinancing
      • steps on refinancing
      • average costs
      • other refinancing FAQs

      You can use our comparison table to help you find the lender that suits you.

      You can also speak to a mortgage broker. They are the best person to reach out to see your options for refinancing. They can give you a multitude of options according to your situation. In the meantime, to give you an estimate of your monthly repayments, you may use our home loan calculator.

      Hope this helps!

      Best,
      Nikki

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