RBA lifts cash rate to 4.85% (November 2026) — review your home loan before you panic

Before you react to the headline: Request a rate review · Refinance calculator · Easy Refinance pathway · Call 0400 77 77 55

On 3 November 2026, the Reserve Bank of Australia raised the cash rate target by 25 basis points to 4.85 per cent, effective 4 November 2026. It is the fifth increase in 2026, and the highest cash rate in 18 years. The vote was not unanimous: six Board members supported the hike; three preferred to leave the target at 4.60 per cent.

If you have a home loan, the useful question is not “how loud is the news cycle?” It is quieter and more practical: what rate am I actually on, when will my lender pass this through, and is there a better structured option than sitting still in fear?

This article is general information for Australian readers. It is not personal credit advice, not a prediction of future Board decisions, and not a promise that refinance, retention or any product will be approved or cheaper on your file. Lending criteria, fees and outcomes vary. Speak with a licensed broker or adviser before you act.

Direct answer

The Board tightened policy because inflation remains elevated and staff forecasts were revised materially higher. In plain terms: prices have been rising too quickly for too long, fuel and commodity pressures (including those linked to conflict in the Middle East) have added to the outlook, and the Board judged that waiting carried a rising risk of inflation expectations becoming sticky. Housing prices have fallen and unemployment has risen as financial conditions tighten — the Board still chose another hike because it sees inflation staying above the top of the 2–3 per cent target band for longer than it expected in August.

For households, that means three separate clocks:

1. The cash-rate clock — now 4.85%.
2. Your lender’s pass-through clock — days to weeks, product-dependent.
3. Your loan-review clock — which you control this week.

What the Board actually said (primary sources)

Read the decision from the source, not the paraphrase:

• RBA media release — Monetary Policy Decision, 3 November 2026
• Cash rate target overview (live target 4.85%, next update flagged for 8 December 2026)
• In Brief: Statement on Monetary Policy — November 2026

Key points that matter for mortgage holders:

• Cash rate target: 4.85% (+0.25 percentage points).
• Vote: 6–3 (hike vs hold at 4.60%). A split vote does not reverse the decision; it does tell you the Board is debating how much pain is enough.
• Inflation path: the Board said inflation is forecast to remain elevated through much of 2027 and not reach the top of the 2–3 per cent range until late 2027 — about three quarters later than previously forecast. The November SMP “In Brief” also points to the midpoint of the target later still (mid-2028 in that summary).
• Real economy: the Board noted the economy is slowing, housing prices have fallen significantly, and unemployment has risen — while still judging further tightening warranted.

None of that is a household instruction to refinance. It is context for why lenders’ funding costs and competitive behaviour may keep shifting even between Board meetings.

Why “another hike” is not the same as “there are no options”

Borrowers often collapse three different ideas into one panic sentence:

1. The cash rate went up.
2. Therefore my rate is now the worst available.
3. Therefore I should either freeze or switch blindly.

That logic fails in Australian mortgage markets for boring, important reasons.

Existing-customer pricing is sticky. Many households sit above the rates lenders advertise to win new business. That gap — sometimes called a loyalty tax — can exist before a Board meeting and still exist after it. A cash-rate rise does not automatically close your personal gap; it can widen the cashflow pressure that makes reviewing the gap overdue.

Pass-through is not robotic. Some lenders move variable rates quickly and fully. Others stagger changes, absorb a little margin for a period, or differentiate between products. Fixed-rate borrowers usually feel the Board decision later — at expiry — unless they break early (break costs can dominate the maths).

Product fit still matters more than the headline cash rate. Offset behaviour, redraw, package fees, remaining term, LVR and income evidence decide whether a “lower rate” is actually cheaper over the life you will keep the loan.

So the calm sequence is: measure your loan → estimate the repayment change → request retention in writing → compare external options term-for-term → then decide.

Illustrative repayment maths (assumptions stated)

This is not your quote. It is a classroom-style illustration so the size of a 25 basis point move is concrete.

Assumptions: principal-and-interest loan, monthly repayments, 30-year remaining term held constant, rate rises by exactly 0.25 percentage points, no fees, no offset.

If your lender passes through less than 25 basis points, the extra repayment is smaller. If your remaining term is shorter than 30 years, the monthly change is usually larger for the same rate move. Run your numbers in a refinance calculator or ask for a broker worksheet — do not treat a table on the internet as advice.

The seven-day checklist (before panic decisions)

Day 1 — Confirm facts, not feeds

Open the RBA release. Write down: 4.85%, effective 4 November 2026, vote 6–3, next Board update window 8 December 2026.

Day 2 — Pull your own statement of truth

From internet banking or your loan schedule, record:

• current interest rate and comparison rate (if shown)
• repayment amount and frequency
• remaining term
• variable / fixed / split
• offset or redraw balance
• any fixed-rate end date

If you cannot find the rate, that is already a problem — call the lender and ask for it in writing.

Day 3–4 — Watch pass-through, do not invent it

Wait for (or chase) the lender notice. Screenshot it. Note the effective date of any repayment change.

Day 5 — Ask for retention pricing in writing

A short email is enough: current balance, rate, remaining term, and a request for the best retention rate they will put in writing for your existing loan. Keep the reply. Verbal “we’ll see what we can do” is not a comparable offer.

Day 6 — Compare external refinance the honest way

Use the refinance service guide mindset:

• same remaining term (watch the term reset trap)
• switching costs and break costs if fixed
• features you actually use (offset, redraw, redraw access)
• whether your file is full-doc, alt-doc, or a repayment-history Easy Refinance candidate — see the Easy Refinance pathway if standard servicing calculators look tight

Day 7 — Decide with a human if the gap is material

If retention or a switch looks better after fees, enquire for a rate review. If the gap is tiny, staying put can be rational. Either way, decide on numbers — not on Melbourne Cup-day noise.

Fixed, variable and split: what changes for each

Variable: most likely to feel the November move through lender pass-through. Review rate and features; a slightly higher rate with a genuine offset can still beat a “cheap” rate with none, depending on balances.

Fixed: the contracted rate usually holds until expiry. The Board decision still matters because it shapes the rate environment you will face at roll-off — and because break costs can make an early exit expensive. Get a break-cost quote before you assume switching is clever.

Split: review each portion separately. Do not average them into one emotional number.

Self-employed and complex-income borrowers

Rate-rise weeks hit business owners twice: higher repayments and the fear that “the bank calculator will say no” if they try to move. That fear is sometimes overstated and sometimes understated.

If income evidence is messy but repayment conduct is clean, ask whether a repayment-history / Easy Refinance-style lane is even in scope before you assume the file is stuck. Start with the self-employed refinance landing and the Easy Refinance pathway. Neither page is an approval. Both exist so you do not lodge the wrong pack in a hurry.

What not to do this week

• Do not refinance solely because a friend refinanced.
• Do not fix the entire loan without pricing break risk and your horizon.
• Do not ignore a retention letter that is already competitive after fees.
• Do not treat “cash rate at 18-year high” as proof that your particular rate is the highest available in the market.
• Do not skip hardship or financial-counsellor pathways if repayments are already unmanageable — the National Debt Helpline (1800 007 007) is free and independent if you are in genuine distress.

Related reading on Azure Home Loans

• August 2026 RBA hold mortgage playbook — how the year looked before this hike
• Home loan loyalty tax guide — why existing customers often overpay
• Wait for rate cuts or refinance now? — timing without prophecy
• Mortgage stress checklist — when cashflow, not the cash rate, is the real problem

FAQ

What did the RBA decide on 3 November 2026?

It raised the cash rate target by 25 basis points to 4.85%, effective 4 November 2026, in a 6–3 majority decision. Confirm on rba.gov.au.

Does this mean my repayment rose today?

Only if your lender has already applied a change to your product. Variable pass-through timing varies. Check your notice.

Is refinancing still possible when the cash rate is rising?

Often yes for eligible borrowers — but rising cash rates do not remove credit assessment, LVR limits, fees or responsible lending. Some files improve with retention alone.

Should I wait for a cut?

The November statement revised inflation higher and did not signal an imminent easing cycle. Waiting can be a deliberate choice; it should not be an unexamined default while you sit on a loyalty premium.

Next step

If you want the November decision translated into your loan — rate, term, retention versus switch — send a short enquiry or call 0400 77 77 55. Ask for a home loan rate review. You reach Bishnu Adhikari at Azure Home Loans (credit representative arrangements as disclosed on site).

General information only. This article does not consider your objectives, financial situation or needs. It is not a credit recommendation. Any refinance, retention or product discussion requires a proper assessment. Approval is never guaranteed.