ANZ hikes mortgage rates again as banks brace for further RBA increases

• ANZ has increased fixed mortgage rates by up to 0.25 percentage points, its second hike in just over three weeks.
• The big four banks have now all passed on September’s RBA increase in full, pushing the average variable rate towards 6.49 per cent.
• Borrowers could face further increases, although higher minimum repayments may not take effect for several weeks.

ANZ has raised its fixed mortgage rates for the second time in just over three weeks, adding to concerns that Australian borrowers could face further rate hikes.

The bank lifted fixed rates by up to 0.25 percentage points on Friday, taking its lowest one-year fixed rate to 6.69 per cent.

The move follows similar increases from Commonwealth Bank, Westpac and NAB, as lenders adjust their pricing amid the prospect of further Reserve Bank tightening.

It comes as millions of mortgage holders begin paying higher interest from Friday after the RBA lifted the official cash rate to 4.60 per cent in September.

The central bank has now increased rates four times this year, adding a full percentage point to borrowing costs.

Why banks are raising rates again

Unlike variable mortgages, fixed rates are influenced by wholesale funding costs and expectations about future interest rates.

Their recent increases suggest banks are factoring in the possibility that borrowing costs could remain elevated or rise further.

According to Canstar, NAB has increased fixed rates twice in three weeks, while CBA and Westpac have lifted some rates by as much as 0.48 and 0.45 percentage points respectively over the same period.

Canstar data insights director Sally Tindall warned borrowers to prepare for another potential RBA increase.

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“If you’ve got a variable rate mortgage, don’t ignore these warning signs,” Tindall said in a statement.

“Once you’ve checked you can clear your new monthly repayment, go back and check if you can weather another hike, because there’s a chance we could be welcoming in 2027 with a cash rate of 4.85 per cent.”

What it means for your mortgage

The latest 0.25 percentage point increase will add about $79 a month to repayments on a $500,000 mortgage, or roughly $950 a year.

For borrowers, the cumulative effect of four increases this year is considerably greater.

Canstar estimates the average variable mortgage rate will reach around 6.49 per cent once the September increase filters through.

However, the lowest advertised variable rate among lenders that have announced their post-hike pricing is 5.94 per cent.

That difference could translate into thousands of dollars in interest savings annually for households able to negotiate a better deal.

Among the big four, Westpac offers the lowest advertised variable rate at 6.24 per cent, followed by NAB at 6.29 per cent, CBA at 6.34 per cent and ANZ at 6.50 per cent.

Still, borrowers have time to act.

Although higher interest rates take effect from today, many borrowers won’t see their minimum monthly repayments increase immediately.

According to Canstar, CBA provides at least 20 days’ notice before changing repayments, while Westpac, NAB and ANZ provide at least 30 days.

Some customers may not see their repayments increase for two or three months, although interest begins accumulating at the higher rate immediately.

For mortgage holders, this creates an opportunity to review their current loan, request a rate reduction, or explore refinancing before higher repayments arrive.

Borrowers struggling to meet repayments can also contact their bank about hardship assistance or seek free financial counselling through the National Debt Helpline on 1800 007 007.