Fixed-rate home loans in Australia are continuing their downward trend this week, with several major lenders reducing rates on one, two, and three-year fixed products. Variable rates remain largely unchanged. Borrowers considering a new purchase or refinance should compare the comparison rate across products, as advertised rates do not include all fees and charges.

What is happening with rates today

As of Wednesday, June 17, 2026, fixed mortgage rates in Australia have dropped again across most major lenders and non-bank providers. One-year fixed rates from several lenders now sit below 5.50 per cent (advertised rate), with two and three-year fixed products also falling by 10 to 25 basis points compared to the previous month. Variable rates, in contrast, have held steady, with most standard variable-rate home loans ranging between 6.00 and 6.50 per cent.

The Reserve Bank of Australia has kept the official cash rate unchanged at its most recent meeting (RBA, 2026), but lender competition and funding cost shifts are driving the reduction in fixed products. According to ASIC MoneySmart, borrowers should always check the comparison rate when evaluating a home loan, as it reflects the true cost by including most fees over a standard loan term (MoneySmart, 2026).

Fixed versus variable: what borrowers should know

Fixed-rate loans lock in your interest rate for a set term (typically one to five years), protecting you from rate rises during that period but also preventing you from benefiting if rates fall further. Variable-rate loans fluctuate with market conditions and lender pricing decisions, offering flexibility and often access to features such as offset accounts and redraw facilities.

The current fixed-rate decline may appeal to borrowers seeking certainty over the next one to three years, particularly if you expect the RBA cash rate to rise or remain elevated. However, fixed loans often come with break costs if you repay early, refinance, or sell during the fixed term. Variable loans, while currently higher on average, allow unlimited extra repayments and switching without penalty in most cases.

What this means for refinancers and new borrowers

If you are refinancing, this is a strong time to compare offers across lenders. Many lenders are offering cashback incentives (typically A$2,000 to A$4,000) to attract refinancers, in addition to the lower fixed rates. Run the numbers on both the advertised rate and the comparison rate, and factor in any application fees, valuation costs, and discharge fees from your current lender.

For new borrowers, particularly first home buyers, the lower fixed rates can help you budget with confidence during the early years of your loan. Keep in mind that you will still need to meet serviceability requirements based on a higher assessment rate (typically 3 percentage points above the loan rate), and lenders mortgage insurance (LMI) applies if your deposit is under 20 per cent of the property value.

Next steps

Check the current comparison rates from at least three lenders for the loan type and term that suits your circumstances. Use the calculators on ASIC MoneySmart or Finder to estimate repayments and total interest cost over the life of the loan (Finder, 2026). If you are uncertain whether to fix or stay variable, or what loan features you need, speak with a licensed mortgage broker who can assess your financial situation and present tailored options.

Rates and offers change frequently. Verify all terms, rates, and eligibility criteria directly with a licensed lender or mortgage broker before making a decision.

General advice warning: This information is general in nature only and does not consider your personal objectives, financial situation, or needs. You should consider obtaining personal advice from a licensed mortgage broker or financial professional before acting on it. This article is not personalised financial, lending, or legal advice. Interest rates, fees, eligibility, and loan features vary by lender, product, and your individual circumstances. The comparison rate includes most fees and charges over a standard loan term (as of June 2026); advertised rates may differ. Always confirm current rates and terms with a licensed lender or broker before deciding.