What happened
The Reserve Bank of Australia raised the cash rate to 4.60% in September 2026, marking its fourth increase for the year. ANZ, CommBank, NAB, and Westpac passed on the full 0.25% increase to variable home loans, taking lowest Big Four rates to between 6.34% and 6.50%. ASIC reported existing major bank customers pay 0.30% to 0.50% more than new borrowers.
Why it matters here
Higher mortgage repayments absorb discretionary household income and increase financial stress for property owners. For Australian investors, rising borrowing costs compress cash flows on leveraged residential properties while driving interest in lower-rate non-bank lenders. Long-term bank customers face annual costs exceeding $1,600 on a $600,000 loan simply by remaining with incumbent lenders instead of refinancing.
What to watch
Effective rate changes take hold on 9 October 2026, making upcoming lender refinancing volumes and household spending figures key metrics to monitor.
Source
mozo.com.au