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Mortgage holders are widely predicted to get more relief tomorrow, as the RBA makes its latest interest rate decision.
Westpac, Commonwealth Bank, and NAB are all anticipating an interest rate cut following July’s meeting, whereas ANZ expects a reduction in August.
If the central bank moves to slash tomorrow, it will likely bring the cash rate down 25 basis points to 3.60 per cent.
Such a cut will be welcomed by home owners who have been squeezed by the continuing hikes.
Money.com.au has crunched the numbers to reveal how much Aussies could save on their monthly mortgage repayments.
If the forecasted 0.25% cut in July takes place, someone with a $600,000 mortgage could save an extra $90 each month, raising their total monthly savings to $273 since the Reserve Bank of Australia (RBA) began lowering rates.
Owners with a $700,000 mortgage would save $106, while an extra $120 would be left in the bank for families with an $800,000 loan.
A borrower with a $1 million mortgage would save $150 a month from the July cut alone, bringing their total monthly savings to $456.
The savings are based on a starting home loan interest rate of 6.24 per cent, the average in February 2025, and a 25-year loan term.
Money.com.au’s Mortgage Expert, Debbie Hays, says a July rate cut would shift the dial for borrowers.
Hays mentioned, “Through our discussions with borrowers, it’s this third rate cut — the concept of the rule of three — that they believe will provide significant relief to their household budgets.”
“After rate hikes in 2022 and 2023, and a sustained period of higher repayments, many are now watching closely to see if and when their lender passes on the cut in full,” she says.
“It’s an additional welcome boost at a time when people are receiving their tax returns â any extra breathing room in the budget is being gratefully received right now.”
“For those still waiting to enter the property market, a third rate cut could boost their borrowing capacity by up to $50,000 â depending on the lender.
“While that might open the door to an extra bedroom or a more desirable suburb, it’s also a double-edged sword, as it will fuel higher property prices and increased competition from other buyers with the same boost in borrowing power.”
