In July 2025, the Reserve Bank of Australia kept the cash rate unchanged as it waited for stronger confirmation that inflation was moving sustainably toward target. Mortgage pricing continued to shift across major banks, especially fixed-rate offers.
Fixed vs Variable
After earlier rate cuts, several lenders adjusted fixed-rate pricing, with some one- and two-year fixed rates becoming more competitive than comparable variable rates. However, the right choice depends on each borrower’s cash-flow needs, offset requirements and view on future rate movements.
Variable loans usually provide more flexibility around offset, extra repayment and refinance. Fixed loans can provide repayment certainty, but may limit extra repayments and can include break costs if the borrower refinances or sells early.
Cashback and New Lending Offers
Cashback and first-home buyer incentives can be attractive, but they should not be assessed in isolation. A lower ongoing rate, suitable offset features and lower fees may be more valuable over the life of the loan.
Borrowers should compare the net benefit after discharge fees, application costs, annual package fees and any product restrictions. A $2,000 cashback may not be attractive if the ongoing rate is materially higher.
Pricing Still Matters
Final variable rates often depend on lender pricing, loan amount, LVR, borrower profile and negotiation. A broker can compare the total package rather than focusing only on the headline rate.
For existing borrowers, repricing with the current lender may be the first step. If the lender cannot offer a competitive rate, a refinance assessment can compare savings, costs, approval risk and settlement timing.