When the RBA moves the cash rate, variable mortgage rates usually follow within weeks. So the real question for most households isn't “what will the RBA do?” — it's “what will it cost me?” Here's a simple way to estimate the impact of an RBA rate change on your mortgage repayments.
The rule of thumb
On a typical 30-year principal-and-interest home loan, a 0.25% rate change moves your repayment by roughly $16 per month for every $100,000 you owe. It's close to linear, so you can scale it to your balance. (The exact figure drifts a little with the starting rate and how many years remain, but $16 per $100k is a solid estimate at current variable rates.)
Repayment impact by loan size
| Loan balance | +0.25% (one hike) | +0.50% (two hikes) |
|---|---|---|
| $500,000 | + ~$81 / month | + ~$162 / month |
| $750,000 | + ~$121 / month | + ~$243 / month |
| $1,000,000 | + ~$162 / month | + ~$324 / month |
A cut of the same size saves you roughly the same amount. Over a full year, a single 0.25% hike on a $750,000 loan is about $1,450 — real money.
What to do before the next meeting
You can't control the RBA, but you can control your rate. A few practical steps:
- Know the odds. Check the market-implied probability of a move at the next RBA meeting so you're not caught off guard.
- Review your current rate. If you haven't checked in a year, you may be on a “loyalty tax” rate well above what new customers are offered.
- Compare and negotiate. Even a 0.20% lower rate can offset most of a hike. Use a comparison service or ask your lender to match a better offer.