Lenders lift 289 fixed rates in a week, though few borrowers fix

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Kooky

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Lenders raised 289 fixed home loan rates in the week after the Reserve Bank lifted the cash rate to 4.60% on 29 September 2026, according to tracking by the comparison group Canstar reported in the mortgage trade press on 7 October. Seventeen lenders moved, and the average rise was 0.24 percentage points.

That is almost exactly the size of the Reserve Bank's own move, yet a fixed rate is not tied to the cash rate in the way a variable rate is. It is a price set for one, two, three or five years ahead, so a lender changing it is saying something about where it thinks its own costs are going. The count is also large for a product that, on the Reserve Bank's figures, accounts for fewer than one home loan in twenty.

Canstar tracking of the week after the 29 September 2026 cash rate decision, as reported by Australian Broker and MPA on 7 October 2026.

What Canstar counted in the week after the decision

Canstar keeps a database of advertised home loan rates and logs each change. In the week after the decision it recorded 289 increases to fixed rates, spread across seventeen lenders, with NAB among them. One lender usually accounts for many entries, because each fixed term, each loan type (owner-occupier or investor) and each deposit tier carries its own advertised rate.

Variable rates moved less in the same week, which is the opposite of what a reader might expect after a cash rate rise. Seven lenders lifted 49 owner-occupier and investor variable rates, by an average of 26 basis points, or 0.26 percentage points. Most lenders had not yet responded when the count was taken, and most of the variable rises already announced were due to take effect over the following week or so. A fixed rate for new customers can be changed overnight. A variable rise reaches existing customers on a date the lender announces in advance.

Canstar's group manager of research, Josh Sale, drew the distinction himself. "The fixed moves are the ones to watch, because lenders are not just passing on September's hike," he told Australian Broker. The same report pointed to higher bond yields and to the possibility of another Reserve Bank increase as the forces behind the fixed repricing, and noted that central banks in the United States, Europe and Japan were also tightening through September.

On Canstar's figures, the average variable rate for an owner-occupier paying principal and interest is 6.63%. The lowest variable rate on its database is 5.69%, from Pacific Mortgage Group, and only two rates sit below 5.75%. The cash rate itself, at 4.60%, is the highest since late 2011.

The repricing started before the Board met

The week after the decision was the second wave, not the first. Fixed rates had been climbing all through September, while the cash rate was still 4.35%.

Canstar's running count shows the pace. By 22 September, sixteen lenders had raised at least one fixed rate during the month. On that day Commonwealth Bank lifted fixed rates for new owner-occupier and investor customers by up to 0.48 percentage points, close to double a standard Reserve Bank move, with a week still to go before the Board met. Its two-year rate went from 6.34% to 6.82%, its one-year rate from 6.49% to 6.78% and its five-year rate from 6.79% to 6.94%. Westpac, NAB and ANZ had each moved by up to 0.20 points the week before.

Two days later the count was eighteen. Macquarie made its second fixed-rate rise of the month on 24 September, of up to 0.20 points, after a rise of up to 0.30 points on 8 September, Australian Broker reported.

By the time Commonwealth Bank had moved, the lowest fixed rate at any of the four major banks was 6.49%, on Canstar's figures. Seven lenders still advertised an owner-occupier fixed rate starting with a 5, the lowest of them 5.79% for one year from a credit union. Those counts are dated 22 September. The reports of the post-decision week did not say how many fixed rates under 6% were left after seventeen more lenders repriced.

Read together, the two waves show the order of events. Lenders priced in the September rise before it happened, then moved again after it. A fixed rate that rises after a decision the market had already expected is being pushed by something other than the decision.

How a fixed rate is priced

The Reserve Bank's explainer on banks' funding costs and lending rates sets out the starting point. A bank lends money it has itself raised, from deposits, from bonds and other debt, and from its shareholders. In its May 2026 Bulletin the Reserve Bank put the mix for the major banks at around two-thirds deposits, almost one-third debt and less than one-tenth equity. The rate on a loan covers the cost of that funding, plus a margin that depends on competition for borrowers and on the risk of the loan.

A variable rate can follow the cash rate closely because the bank can change it whenever its funding gets dearer. The same Bulletin article found that banks passed the 2025 cash rate cuts in full to new variable-rate home loans, and raised those rates broadly in line with the cash rate in early 2026.

A fixed rate cannot be changed once the loan is drawn, so the bank has to know today what the money will cost for the whole term. The benchmark it uses is the swap rate: the fixed rate at which financial markets will exchange a floating rate for a set number of years. A three-year swap rate is, in effect, the market's view of where short-term rates will average over three years. The Bulletin article says new fixed mortgage rates follow tenor-matched swap rates, "tenor" meaning the term, and that those fixed rates fell through most of 2025 and began to rise around the end of that year as swap rates turned.

The chain runs like this.

This is why fixed rates can rise before a decision, as Commonwealth Bank's did, and why they can fall while the cash rate is still on hold.

How few borrowers actually fix

For all the repricing, the fixed-rate loan is a small corner of the Australian market in 2026. The Reserve Bank's May 2026 Bulletin put the share of outstanding housing loans on fixed rates at a historical low of less than 5% in 2025. Its February 2026 Statement on Monetary Policy, quoted by Commonwealth Bank in a newsroom article of 1 May 2026, described less than 5% of both new and outstanding mortgages as fixed.

It was very different four years ago. A Reserve Bank Bulletin article of March 2023 recorded that fixed-rate loans peaked at almost 40% of outstanding housing credit in early 2022, about twice the level before 2020, after lenders with access to cheap pandemic-era term funding advertised fixed rates below variable ones. By the middle of 2022, as market yields rose, new fixed-rate lending had fallen to around 5% of all new lending.

The same article noted that most Australian borrowers who fix do so for three years or less, and that fixed-rate loans are much more common in New Zealand, Canada, the United Kingdom and the United States. The practical result is that the 289 changes touch only people taking out or rolling over a fixed loan now. A borrower already inside a fixed term keeps the contracted rate until it ends.

Interest in fixing has risen with the cash rate all the same. Commonwealth Bank said in that May article that online searches for fixed-rate loans were up more than 250% in March 2026 on a year earlier, and that such searches tend to spike around Reserve Bank announcements. It also pointed out that a fixed rate can change between application and funding unless the lender offers a rate lock, usually for a fee. Leaving a fixed loan before its term ends can trigger a break cost, a charge with rules of its own.

What the numbers look like on a Queensland-sized loan

Canstar expresses the year's rises on a $600,000 loan repaid over 25 years: $364 a month more than before the first of 2026's four cash rate rises once the latest is fully passed on, about $91 of it from the September rise alone.

Queensland's new borrowers are above that mark. The average new owner-occupier loan in the state was about $751,000 in June 2026, a record, up from $741,000 in March, according to the Australian Bureau of Statistics lending indicators released on 14 August 2026 (original figures, not seasonally adjusted). It is the average of loans written in that period, not the average balance of every Queensland mortgage.

Repayments on a principal and interest loan rise in direct proportion to its size when the rate and term are the same. Scaled from $600,000 to $751,000, Canstar's $364 becomes about $456 a month and its $91 becomes about $114.

The table below is a worked example, not a quote. It takes a $751,000 loan repaid by principal and interest over 25 years, with monthly repayments and no fees or offset balance, and applies four of the rates named in this article.

Two gaps stand out. The distance between the lowest variable rate and the average one is $435 a month on this loan, which is nearly as much as all four of the year's rises together. And Commonwealth Bank's single two-year repricing, from 6.34% to 6.82%, is worth $226 a month: the same loan costs $4,996 at the old rate. Over the 24 months of the term, that is $5,424.

None of this shows which rate type costs less over time. That depends on what the cash rate does during the term, which nobody knows, and on features the repayment figure leaves out: fixed loans commonly limit extra repayments and offset accounts, and each borrower's use of them differs.

What comes next

The first date is 28 October, when the September inflation figures are due. Headline inflation was 4% in August, a four-month high, while the Reserve Bank's preferred underlying measure held at 3.6% and unemployment rose to 4.6%, its highest in almost five years, MPA reported.

The four major banks are split on what follows. Commonwealth Bank and NAB expect 4.60% to be the peak, while Westpac and ANZ forecast one more increase in November. Canstar's Josh Sale called a fifth rise a live question.

Fixed rates will not wait for the answer. Because they follow swap rates, they will move with each piece of data that changes the market's view, in either direction, and the first sign of a shift is likely to show up in Canstar's weekly count before it shows up in a Reserve Bank statement.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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