A financial storm is brewing, and it's time to brace ourselves for the impact. The recent actions of Australia's major banks have sent shockwaves through the market, leaving many homeowners and prospective borrowers reeling. With 53 lenders hiking their fixed rates and two lenders increasing variable rates, the landscape has shifted dramatically.
But here's where it gets controversial: these moves come just days before the RBA's crucial February 3 meeting. In a mass repricing event, 53 Australian lenders have adjusted their fixed home loan rates since the Reserve Bank's December 9 meeting, with the country's biggest banks leading the charge.
The timing couldn't be more concerning. Two lenders, Heritage Bank and People's Choice, have effectively increased variables by half a rate rise, a significant move so close to the February monetary policy meeting.
Canstar's data insights manager, Sally Tindall, sheds light on the banks' motives: "When the RBA Governor hints at a potential cash rate hike, banks take notice." And notice they did. Over half of the lenders on the Canstar database have hiked at least one fixed rate since the last RBA board meeting, including all four major banks.
The last time RBA Governor Michele Bullock agreed to a rate hike was on November 7, 2023, increasing the rate by 25 basis points to 4.35%. This decision was driven by the failure to contain inflation, which Bullock considered "still too high" when compared to the expected 3.5% by the end of 2024.
All eyes are now on the upcoming December inflation data, set to be released on January 28. The current inflation rate, sitting at 3.4% in November, is a key factor in the RBA's decision-making process. With housing costs rising 5.2% annually, the RBA is faced with a challenging task of cooling the market.
Commonwealth Bank took the hardest stance on fixed rates, increasing its three-year fixed rate by a whopping 70 basis points to 6.04%. This move translates to over $200 extra per month for some borrowers. Macquarie Bank followed suit, lifting rates across all fixed terms by 0.25%, marking its second hike in just six weeks.
"Fixed rates starting with a '4' are now in the banks' crosshairs," warns Ms. Tindall. "Just 12 lenders are offering rates under 5%, down from over 40 three months ago. This is a preemptive move by the banks in anticipation of a higher cash rate in 2026."
The list of lenders making adjustments includes household names like ANZ, NAB, and Westpac, along with their subsidiaries and regional banks. All have repriced their offers, leaving borrowers with a shrinking pool of options.
Predictions vary, with CBA and NAB both forecasting a 0.25% rate rise on February 3. Citi economists expect two hikes this year, but the market remains cautious, pricing in only a 25% chance of an increase to 3.85% and a 75% chance the RBA will hold steady.
Next Wednesday's quarterly inflation results will be a pivotal moment. As Ms. Tindall notes, "While the RBA emphasizes that no single dataset drives their decisions, next Wednesday's inflation results are critical. If inflation shows a concrete improvement, it may be enough to avoid a hike at the first meeting of 2026. But if it remains stagnant, a rate hike could be on the cards."
If the RBA does increase the cash rate target this year, it will mark the first such increase since November 7, 2023.
For owner-occupiers on variable rates, the average is currently 5.52%. Borrowers with a strong track record should aim for a rate of 5.25% or lower, as over 40 lenders are offering variable rates under this mark.
"Now is the time to scrutinize your current home loan and push your lender for a better deal," advises Ms. Tindall. "The disparity between market leaders and laggards is widening, and loyalty is not rewarded in this environment."
While there's still a chance to fix rates under 5%, time is running out. Fixed rates under 5% may soon become a thing of the past.
Ms. Tindall emphasizes the importance of due diligence, even as the window narrows: "Fixed rates come with additional rules and caveats. These include caps on extra repayments, often no offset account access, and break fees if you want to exit early. These are critical considerations before locking in a fixed rate."
According to Canstar's calculations, a single 0.25 percentage point interest rate hike could increase a typical $600,000 mortgage repayment by $90 per month. For a $750,000 loan, the increase would be $112, and for a $1 million mortgage, it would be an extra $150 per month.
Ms. Tindall urges borrowers to stress-test their budgets against potential rate increases: "Ensure your rainy-day buffer is substantial. Don't let a potential rate hike catch you off guard."
Here's the full list of lenders that have hiked their rates:
Fixed Rates (December 10, 2025 - January 21, 2026):
- ANZ
- Aussie
- Australian Military Bank
- Australian Mutual Bank
- Auswide Bank
- Bank Australia
- Bank First
- Bank of China
- Bank of Melbourne
- BankSA
- BCU Bank
- Bendigo Bank
- BOQ
- Commonwealth Bank
- Community First Bank
- Easy Street Fin Services
- Firefighters Mutual Bank
- Firstmac
- G&C Mutual Bank
- Geelong Bank
- Great Southern Bank
- Health Professionals Bank
- Heritage Bank
- Homestar Finance
- Horizon Bank
- HSBC
- Hume Bank
- Illawarra Credit Union
- IMB
- ING
- loans.com.au
- Macquarie Bank
- ME
- MyState Bank
- NAB
- P&N Bank
- Pacific Mortgage Group
- People's Choice
- Police Bank
- Police Credit Union
- Qudos Bank
- Queensland Country Bank
- RACQ Bank
- St George Bank
- Summerland Bank
- Suncorp Bank
- Teachers Mutual Bank
- The Mutual Bank
- Ubank
- UniBank
- Unity Bank
- Up
- Westpac
Variable Rates (January 12 - 18, 2026):
- Heritage Bank
- People's Choice
Source: Canstar.com.au (21/01/2026)
Based on owner-occupier and investment loans on Canstar's database, available for any loan amount and LVR.
Excludes introductory and first-homebuyer-only home loans.
