Where rates stand right now
The RBA has raised the cash rate three times in 2026 so far — 0.25 percentage points each in February, March and May — before holding it steady at 4.35% at the August meeting. The minutes noted that financial conditions have tightened as expected following the earlier hikes and the economy has slowed accordingly, but inflation remains elevated, and a further hike isn’t ruled out if upside risks materialise.
In other words, the market is in a “wait and watch” phase, not a confirmed easing cycle. Some major banks (ANZ, for one) are forecasting a further 0.25 percentage point hike in November if upcoming inflation data disappoints, which would take the cash rate to 4.60%. Whether that plays out depends entirely on the inflation prints over the coming months — nobody can say for certain.
What this means for buyers and homeowners
If you’re preparing to buy: banks don’t just assess whether you can afford your rate today — they run a “serviceability buffer” test. APRA requires banks to add a 3 percentage point buffer on top of the actual loan rate when assessing your ability to repay. With mainstream variable rates currently around 6.1%–6.8%, banks are effectively testing your serviceability at 9.1%–9.8%. That means your borrowing capacity is more conservative than the “headline rate” alone would suggest, even without any further rate movement.
If you already have a mortgage: if you’re on a variable rate, the first three hikes should already be reflected in your repayments; if the rate does move to 4.60%, variable repayments will step up again. This is a good moment to review whether your current structure still suits you — whether it’s worth fixing part of your loan for certainty, or renegotiating your rate with your lender (refinancing).
Our recommendation
Honestly, nobody can say for certain whether rates will move again, or when they might fall — treat any confident “prediction” with caution. Rather than betting on a rate direction, it’s more practical to:
- Always estimate your true repayment capacity using the serviceability-buffer rate (not the headline rate), and build in a margin;
- If your income or cash flow is already tight, talk to an advisor about whether your loan structure needs adjusting (for example, partly fixed, or staged settlement);
- If you already have a mortgage, we’d suggest an annual rate health-check to see whether your current deal is still competitive.
If you’d like to work out roughly how much you could borrow, or what your repayments would look like, under the serviceability-buffer test, get in touch for a free assessment.
The cash rate figures and hike dates referenced here reflect publicly available information at the time of writing (September 2026), for general information only and not financial or investment advice; actual rates, policy and bank approval criteria may change at any time — please refer to the latest announcements from the relevant banks/regulators and your own loan contract.
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