The Reserve Bank of Australia's decision to hike the cash rate will have millions of mortgage holders frantically doing the math to see how their home loan repayments will change.
The official cash rate has been increased by 0.25 basis points to 3.85 per cent, meaning if your lender responds by raising its rate – which the big four Australian banks typically do – your mortgage repayments will rise too.
Homeowners on a variable interest rate for their home loan could see repayments surge by over $100 per month.
For example, borrowers with a loan of $700,000 will see a monthly increase of $105, raising the monthly repayment to $4412.
Those with a $1 million mortgage would be paying an extra $150 per month, bringing the monthly repayment to $6303.
"This news will feel like a cold shower for homeowners after a brief reprieve," said Finder's head of consumer research Graham Cooke.
"Many who refinanced or entered the market during the 2025 easing cycle may feel blindsided, as the pivot from falling to rising rates in just 6 months has created significant whiplash."
Today's decision comes just under six months since the RBA last cut the rate.
Cooke said last year's brief mortgage stress relief may have been "wiped away" following today's rate hike.
Treasurer Jim Chalmers acknowledged the decision is "difficult news" for millions of Australians with a mortgage.
"We understand the pressure that this puts on Australian families and businesses," Chalmers said.
"While today's decision was widely expected, obviously that doesn't make it any easier."
Not everyone with a mortgage will be worse off, though.
Not all borrowers decreased their repayments when rates fell last year.
According to Canstar, about 80 per cent of NAB variable rate customers and the "vast majority" of CBA's didn't reduce their repayments, giving them some welcome wiggle room now.
If you are on a fixed rate, your repayments will stay the same until the fixed term ends.
There's a silver lining: the rate hike means those with a savings account or term deposit will enjoy a greater return on their money.
When rates are higher, savings products will generally pay more interest.
When the cash rate is lowered, interest returns will generally fall.
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