RBA held at 4.35% in August 2026. Find out what to do when interest rates change – fixed, variable, and refinancing options explained by Strawberry Finance.
One option some borrowers explore when interest rates change – particularly when they are rising – is moving to a fixed rate home loan. A fixed rate can provide repayment certainty, as your interest rate stays the same for an agreed period. This can make budgeting easier and protect against further rate increases during that fixed term. However, fixed rate loans may come with trade-offs that are important to understand before committing:
Variable rate home loans can increase when interest rates change upward, but they often provide more flexibility than fixed rate products. For many Perth borrowers, the flexibility of a variable loan outweighs the certainty of fixing – particularly if they hold a significant offset account balance or are making regular extra repayments. Potential benefits of staying variable may include:
Refinancing involves replacing your current loan with a new one – either with your existing lender or a different lender. When interest rates change, refinancing can be a powerful tool to access a more competitive rate, change your loan features, adjust your loan term, or better align your loan with your current financial needs. For Perth homeowners, the city’s strong property growth over recent years means many borrowers have also accumulated significant equity that can be accessed or restructured through a refinance.
Refinancing may allow you to: access a more competitive interest rate (the gap between competitive and uncompetitive variable rates is often 0.3%–0.6% p.a., representing thousands of dollars per year on a typical Perth mortgage); change your loan features to include or remove offset accounts, redraw, or IO periods; adjust your loan term to reduce monthly repayments or pay your loan off faster; and consolidate other debts at the home loan rate. It is important to understand the costs before refinancing, as outlined below.
Refinancing when interest rates change can be the right call – but it is important to understand the full picture before you switch. A CA-qualified mortgage broker at Strawberry Finance models your specific numbers: the rate saving, all costs, and the true break-even point so you can make a confident decision. Key costs and considerations to be aware of before refinancing:
Beyond the loan structure decision, there are broader financial management strategies worth considering when interest rates change. Higher interest rates may also increase the return on your savings accounts – which can help offset rising loan costs if you are holding cash. Paying down personal loans, credit cards, or other debts can improve your monthly cashflow and reduce overall interest paid across all obligations – freeing up more to direct toward your home loan if needed. If you are considering debt consolidation, be cautious about the full cost: consolidation can simplify payments and reduce the monthly obligation, but spreading debts over a longer repayment term can extend the total interest paid over the life of the loan. Always model the 3-year and 10-year total cost before consolidating, not just the monthly saving. No two borrowers are exactly alike – which is why speaking to Strawberry Finance is important when it comes to maintaining your financial wellbeing across rate change periods.
The Reserve Bank of Australia held the cash rate at 4.35% at its August 2026 monetary policy meeting. The Board assessed that inflation is continuing to moderate, but that it is not yet sufficiently confident that inflation will return sustainably to the 2–3% target band to justify a rate reduction at this stage. The next RBA meeting is scheduled for September 2026. For the most current RBA guidance, visit rba.gov.au.
Whether fixing your rate is the right call depends on your specific financial situation — your loan balance, offset account balance, how long you plan to stay in the property, and whether you need repayment certainty. Fixed rates provide certainty and protection if rates rise further, but you give up flexibility and may miss out if rates fall. Strawberry Finance models both scenarios against your specific numbers before making any recommendation. Call 0457 133 453 for a free assessment.
If you have not reviewed your home loan in the past 12 months, it is almost certainly worth doing so. Many Perth borrowers are sitting on rates that are 0.3%–0.6% above what a comparable loan at a competitive lender would cost today. On a $600,000 loan, a 0.5% rate saving is $3,000 per year. A free refinancing review with Strawberry Finance takes 30 minutes and costs nothing. We model the saving, all costs, and the true break-even point.
A split loan divides your home loan into two portions: one on a fixed rate and one on a variable rate. The fixed portion gives you repayment certainty on part of your debt; the variable portion maintains access to offset accounts, extra repayments, and the potential to benefit if rates fall. The optimal split ratio depends on your financial position, risk tolerance, and how much of your loan you want to protect versus keep flexible. Strawberry Finance can model different split ratios against your specific cashflow and goals.
The simplest benchmark: the current competitive owner-occupier variable rate for well-qualified Perth borrowers is approximately 5.7%–5.9% p.a. (as at August 2026). If your rate is above 6.1%, you are likely paying a premium. A Strawberry Finance broker runs your income, LVR, and loan balance against 40+ lenders to confirm whether a better rate is available — and whether the saving justifies the refinancing costs after break-even analysis.
Strawberry Finance is a CA-qualified Perth mortgage broker based in Hillarys WA. Director Sahil Saini holds a Chartered Accountant qualification alongside his finance broking accreditation — which means every rate change conversation covers not just the lending decision but the broader financial and tax implications of your options. Free consultations are available by phone, video, or in person. Call 0457 133 453 or visit strawberryfinance.com.au/contact-us/.
Note: This article is intended to provide general information only. It does not take into account the financial situation, objectives, or needs of any individual reader and must not be relied upon as financial product or credit advice. While every effort has been made to ensure the accuracy of the information provided, some details may change over time or may not always reflect the most current market conditions. Readers should consider seeking independent financial or professional advice before making any financial decisions based on this information.
RBA held at 4.35% in August 2026. Find out what to do when interest rates change – fixed, variable, and refinancing options explained by Strawberry Finance.
Learn how a debt consolidation home loan Perth 2026 strategy can combine high-interest debts into your mortgage, simplify repayments and improve cash flow.
CA-qualified mortgage broker Joondalup and northern suburbs Perth. Keystart, FHBG, investment loans, refinancing. Free consultation. Call 0457 133 45.