Home Loan Rates Australia 2025
Variable, fixed, investor, owner-occupier — where rates actually sit right now and how a broker gets you below what's advertised.
Current rate snapshot
Indicative ranges across major and second-tier lenders. Your actual rate depends on LVR, loan size, employment type, and lender. Broker-negotiated rates are often at or below the bottom of these ranges.
| Loan type | Rate range (p.a.) | Notes |
|---|---|---|
| Variable — owner-occupier (P&I, ≤80% LVR) | 5.74% – 6.49% | Most competitive |
| Variable — owner-occupier (P&I, >80% LVR) | 6.14% – 6.89% | LMI may apply |
| Fixed 1 year — owner-occupier | 5.89% – 6.59% | — |
| Fixed 2 years — owner-occupier | 5.94% – 6.74% | — |
| Fixed 3 years — owner-occupier | 6.04% – 6.89% | — |
| Variable — investor (P&I) | 6.09% – 6.84% | — |
| Variable — investor (interest-only) | 6.39% – 7.14% | Higher risk profile |
Rates are indicative only and change frequently. P&I = principal and interest. LVR = loan-to-value ratio. Rates sourced from publicly available lender information and broker channel data as at April 2025. Not a quote — speak to a broker for lender-specific pricing.
Variable vs. fixed: which suits you?
There's no universally right answer. It depends on your budget certainty needs and rate outlook.
Variable Rate
Moves with the RBA cash rate and lender margin decisions. When rates fall, you benefit automatically. When they rise, repayments increase.
Best for: Borrowers with budget flexibility, those planning to pay off extra, or anyone who wants maximum loan features.
Fixed Rate
Locked in for 1–5 years regardless of what the RBA does. Certainty over your repayments — useful for tight budgets or planning around a fixed income.
Best for: Borrowers who need certainty, first home buyers on a tight budget, or those who won't need to sell or refinance in the fixed period.
Not sure which to choose?
A split loan — part fixed, part variable — gives you stability on one portion while keeping features (offset, extra repayments) on the other. Tom can model both scenarios for your situation.
Book a free rate comparisonWhat actually determines your rate
The rate you get isn't just the RBA cash rate plus a margin. Lenders apply risk-based pricing across multiple factors. Understanding these gives you leverage.
LVR (Loan-to-Value Ratio)
The single biggest lever. Below 80% LVR, you access the sharpest pricing and avoid LMI. Each 10% LVR tier can add 0.10–0.30% to your rate.
Loan purpose
Investment loans are typically priced 0.25–0.50% higher than equivalent owner-occupier loans. Interest-only adds another premium on top.
Loan size
Larger loans often attract better rates — lenders make more margin on a $1M loan than a $300k loan, so they'll price competitively to win the business.
Employment type
PAYG employees with standard payslips are priced most favourably. Self-employed borrowers using alt-doc products typically pay a higher rate.
Lender and channel
The same lender often has different pricing for walk-in vs broker applications. Some lenders only distribute through brokers and are unavailable direct.
The broker rate advantage
Brokers with high settlement volumes negotiate pricing tiers with lenders that aren't available to individual applicants. On a $600,000 loan, a 0.20% rate reduction saves ~$1,200/year — $30,000 over a 25-year term.
See the impact in the calculatorHome loan rate FAQs
What is a good home loan rate in Australia in 2025?
As of April 2025, a competitive variable rate for an owner-occupier with a 20%+ deposit (≤80% LVR) sits between 5.74% and 6.20% p.a. The big four banks' advertised rates are typically 0.2–0.6% higher than the sharpest rates available through a broker. The 'best' rate for you depends on your LVR, loan size, employment type, and lender — a mortgage broker can access rates unavailable to the general public.
Should I fix my home loan rate or stay variable?
It depends on your risk tolerance and timeline. Variable rates move with the RBA cash rate: they can fall (saving you money) or rise (costing you more). Fixed rates lock in certainty for 1–5 years, which is useful for tight budgets, but come with break costs if you exit early and usually no offset account. A split loan (part fixed, part variable) gives you both stability and flexibility. There's no universally right answer — it depends on your circumstances.
How does the RBA cash rate affect my home loan?
The Reserve Bank of Australia sets the cash rate at monthly board meetings. When the RBA raises rates, banks typically pass the full increase (or more) to variable rate borrowers within days. When the RBA cuts rates, banks sometimes pass less than the full cut and take longer to do it. Fixed rate loans are set at the time of application and are unaffected by RBA moves during the fixed period.
Why is my bank's advertised rate higher than what I've seen a broker advertise?
Banks publish a 'headline' rate but routinely offer discounts below it — especially to customers with large loans, low LVRs, or who apply through aggregator channels (which is how most brokers operate). Brokers access these discounted rates and can often negotiate further. Additionally, some lenders only distribute through brokers at all, making their products unavailable if you apply directly.
What is a comparison rate and why is it different from the interest rate?
The comparison rate includes most standard fees (application fees, ongoing fees) expressed as an annual percentage, giving a more realistic cost of the loan. For example, a loan advertised at 5.99% with high fees might have a 6.29% comparison rate. However, comparison rates are calculated on a standard $150,000 loan over 25 years — for larger loans, fee impact is proportionally smaller. Use it as a guide, not a definitive ranking.
Does my LVR affect the interest rate I get?
Yes — significantly. Lenders consider loans above 80% LVR higher risk, so they price accordingly. Below 80%, you access the sharpest rates (and avoid LMI). Many lenders have tiered pricing: ≤60% LVR, 60–70%, 70–80%, 80–90%, 90–95%. Each tier typically adds 0.05–0.30% to your rate. Building up a larger deposit — or having your property appreciated — can shift you into a lower tier and reduce your rate.