While fixed home loan rates have been falling on the market for some months, variable rates have been slower to move.

On Thursday, NAB announced its base variable rate for new owner occupiers making principal and interest repayments is now 6.44% pa. (6.48% p.a. comparison rate) – a 40-basis point drop.

Its rates for owner occupiers and investors making interest only repayments have also been slashed by 60 basis points.

Here are the new rates below:

Product Change (% p.a.) New rate Comparison rate*
Base variable rate (P&I) -0.40 6.44% p.a. 6.48% p.a.
Base variable rate (IO) -0.60 7.34% p.a. 6.87% p.a.
Investor base variable rate (P&I) -0.40 6.96% p.a. 7.00% p.a.
Investor base variable rate (IO)  -0.60 7.67% p.a. 7.32% p.a.

NAB's basic variable home loans come with no application or monthly fees and the above rates are available to owner-occupiers with loan-to-value ratios (LVR) of up to 95%.

Investors must have an LVR of 90% or less in order to receive the new rates.

There are also no charges for making additional payments and a no-fee redraw facility on extra payments.

Big four base variable rates

The move on NAB’s base variable rates puts it in line with the base rates of two of its big four peers, CommBank and Westpac.

Here’s a comparison of the big four’s basic variable rates for new owner occupiers paying P&I below:

Product Base variable rate Comparison rate* Conditions
NAB Basic Variable  6.44% p.a. 6.48% p.a.
CBA Standard Variable 6.34% p.a. 6.72% p.a. Part of annual $395 Wealth Package
Westpac Featured Basic Variable 6.44% p.a. 6.76% p.a. Includes 2-year 1.64% p.a. discount and 0.10% discount for LVR up to 70%
ANZ Standard Variable 7.24% p.a. 7.24% p.a. Rate for LVR 80% or less

Market rates dropping but cash rate holding

All big four banks have dropped various mortgage interest rates over the past few months despite no movement in the Reserve Bank of Australia’s cash rate.

It’s remained at 4.35% for the past year with the RBA board reiterating it will only cut the rate when it’s satisfied inflation is sustainably within its target range of 2-3% on an annual basis.

In the latest quarterly reading, released last month, annual CPI inflation was at 2.8% although underlying inflation, the RBA’s preferred measure, was at 3.5% p.a.

Falling home loan rates across the market, particularly fixed rates, reflect lower rates on international money markets, where many Australian financial institutions source funds.

All big four banks are expecting a fall in Australia’s cash rate early in 2025, with CommBank, ANZ, and Westpac nominating February while NAB forecasts it will be in the first quarter of the year.

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Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Update resultsUpdate
Filters
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees Max LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkComparePromoted ProductDisclosure
6.04% p.a.
6.06% p.a.
$3,011
Principal & Interest
Variable
$0
$530
90%
4.6 Star Customer Ratings
  • Available for purchase or refinance, min 10% deposit needed to qualify.
  • No application, ongoing monthly or annual fees.
  • Quick and easy online application process.
Disclosure
5.99% p.a.
5.90% p.a.
$2,995
Principal & Interest
Variable
$0
$0
80%
Apply in minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
 Disclosure
6.09% p.a.
6.11% p.a.
$3,027
Principal & Interest
Variable
$0
$250
60%
  • No annual fees – None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
 Disclosure
5.69% p.a.
6.16% p.a.
$2,899
Principal & Interest
Fixed
$0
$530
90%
  • Available for purchase or refinance, min 10% deposit needed to qualify.
  • No application, ongoing monthly or annual fees.
  • Flexibility to split your loan with both fixed and variable rates
 Disclosure
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

Important Information and Comparison Rate Warning

Image by Jacek Dylag via Unsplash



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