Rate Hikes Slam Aussie Homeowners with Record-Breaking Repayment Increases

Rate hikes are set to leave Australian mortgage holders hundreds of dollars poorer each month as interest rates reach a 15-year high.

The Reserve Bank is expected to increase the cash rate by 25 basis points for a fourth time in 2023, adding $91 per month on a typical $600,000 mortgage, according to Sally Tindall, data insights director at Canstar. This would push the average owner-occupier variable rate up to 6.49 per cent.

Tindall noted that across four potential rate rises this year, borrowers could see their monthly repayments increase by $364 compared to January.

RBA governor Michele Bullock suggested earlier that unemployment needs to be higher to curb inflation, sparking a furious response from union groups and the social service sector. They argue that raising interest rates is creating unemployment by design, putting thousands of people out of work to slow the economy.