As markets await the Reserve Bank of Australia's first meeting of 2025, home lenders are working overtime to be ready should the board decide to cut the cash rate on Tuesday.

Markets had been pricing in a 95% chance of a February cash rate cut since the latest inflation data was released on 29 January, indicating the scene was set for a rate cut.

But the certainty came off the boil this week with US inflation climbing higher than expected.

Australian market expectations of a cash rate cut dropped to 90% but that's not bad odds in anyone's book.

The big four banks remain united in tipping the first cash rate cut in more than four years will happen on Tuesday.

In that vein, many lenders have been positioning their fixed home loan rates to hold up in a lower interest rate environment for some months while variable rates have largely remained unchanged, waiting for the Reserve Bank to pull the trigger for a cash rate cut.

This week, the Westpac stable of lenders has cut some of its fixed rates by up to 40 basis points, as have Bank of Queensland group and AMP Bank.

Let's check all this week's home loan rate movements.

Westpac-owned banks cut fixed rates

The Westpac group includes St George Bank, Bank of Melbourne, and BankSA, all of which have dropped their best fixed rate to 5.59% p.a. albeit with a heftier comparison rate* of 7.42% p.a.

That applies to new owner-occupier loans for package customers fixing for two years, making principal and interest (P&I) repayments and with loan-to value ratios (LVRs) ≤70%.

It's a cut of 30 basis points off the old rate, with the Westpac banks cutting their one- and two-year fixed rates by between 20 and 40 basis points across the board.

Here's a selection of Westpac's new rates for owner occupiers making P&I repayments:

Product % change New rate Comparison rate*
Fixed Options ≤70% 1 year -0.4 5.99% p.a. 8.64% p.a.
Fixed Options ≤70% 2 years -0.3 5.89% p.a. 8.33% p.a.
Fixed Options 70-80% 1 years -0.4 5.99% p.a. 8.64% p.a.
Fixed Options 70-80% 2 years -0.3 5.89% p.a. 8.33% p.a.

Fixed Options >80% 1 year

 -0.4 5.99% p.a. 8.64% p.a.
Fixed Options >80% 2 years -0.3 5.89% p.a. 8.33% p.a.
Premier Advantage ≤70% 1 year -0.4 5.69% p.a. 7.60% p.a.
Premier Advantage ≤70% 2 years -0.3 5.59% p.a. 7.42% p.a.
Premier Advantage 70-80% 1 year -0.4 5.79% p.a. 7.70% p.a.
Premier Advantage 70-80% 2 years -0.3 5.69% p.a. 7.51% p.a.
Premier Advantage >80% 1 year -0.4 6.09% p.a. 8.00% p.a.
Premier Advantage >80% 2 years -0.3 5.99% p.a. 7.80% p.a.

Westpac's Premier Advantage Package offers an interest rate discount and other product savings for an annual package fee of $395.

The Westpac group has also made cuts to its fixed rate and Premier Advantage investment loans.

BoQ group drops fixed rates by up to 15 bp

Bank of Queensland and its subsidiary ME Bank have also trimmed fixed rates on residential and investment loans.

BoQ's new best rate is 5.54% p.a. for its discounted residential fixed loan for new owner occupiers with <80% LVR paying P&I (comparison rate* 6.35 % p.a. fixed for two years, 6.27% fixed for three years).

Here are BoQ's new residential fixed rates for owner occupiers making P&I repayments:

Product % change New rate Comparison rate*
2 years fixed -0.15 5.89% p.a. 6.41% p.a.
2 years fixed discount (<80% LVR) -0.15 5.54% p.a. 6.35% p.a.
3 years fixed -0.15 5.89% p.a. 6.37% p.a.
3 years fixed discount (<80% LVR) -0.15 5.54% p.a. 6.27% p.a.
4 years fixed -0.15 6.19% p.a. 6.44% p.a.
4 years fixed discount (<80% LVR) -0.15 5.84% p.a. 6.31% p.a.
5 years fixed -0.15 6.19% p.a. 6.43% p.a.
5 years discount (<80% LVR) -0.15 5.84% p.a. 6.27% p.a.

BOQ's discounted rates are only available for new-to-bank lending.

Investment fixed rate loans are 25 basis points higher.

AMP Bank drops package loan fixed rates by up to 35 bp

Joining the groupthink this week is AMP Bank which also dropped its Professional Package fixed rate loans for new-to-bank owner occupiers and investors.

Its best new fixed rate for owner-occupiers is 5.70% p.a. for those with LVRs ≤80% paying P&I and fixing for two years (7.02% p.a. comparison rate*) or three years (6.89% p.a. comparison rate*).

Here's the latest Professional Package fixed rates for owner occupiers paying P&I:

Product % change New rate Comparison rate*
1 year (≤80% LVR) -0.15 5.89% p.a. 7.19% p.a.
2 years (≤80% LVR) -0.19 5.70% p.a. 7.02% p.a.
3 years (≤80% LVR) -0.19 5.70% p.a. 6.89% p.a.
5 years (≤80% LVR) -0.2 6.09% p.a. 6.82% p.a.
1 year (80-90% LVR) -0.15 6.09% p.a. 7.28% p.a.
2 years (80-90% LVR) -0.19 5.90% p.a. 7.12% p.a.
3 years (80-90% LVR) -0.19 5.90% p.a. 7.00% p.a.
5 years (80-90% LVR) -0.2 6.29% p.a. 6.82% p.a.

80-90% LVR loans also come with Lenders Mortgage Insurance (LMI).

Professional Package loans attract an annual fee of $349 but don't charge for other loan fees.

Other rate movers

  • Police Bank has dropped rates on its Police Value and Gold Rate fixed and variable home loan rates by up to 65 basis points.
  • As of this week, Rural Bank is no longer offering banking products, including farming loans, transitioning its products to equivalent Bendigo Bank products on 14 March 2025.

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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.
6.08% 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%
  • Easy application. Fast approval. No annual fee.
  • Unlimited additional repayments free of charge.
  • Redraw freely - Access your additional payments.
 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 Michael Tuszynski via Pexels



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