If you’re wondering whether home loan interest rates in Australia are finally heading south—you’re not alone. After a long stretch of rate hikes, Australian borrowers were given a welcome break in March 2025, when the Reserve Bank of Australia (RBA) cut the official cash rate by 0.25%, from 4.35% to 4.10%.

So, what does this mean for homeowners, property investors, and first home buyers? Is this the beginning of a downward trend? Let’s break it down.

March 2025 RBA Rate Cut – What Happened?
In a move that surprised many economists, the RBA slashed the cash rate by 25 basis points in March 2025. This was the first rate cut since 2020, following a series of 13 consecutive increases aimed at curbing inflation.

The rate cut reflects easing inflationary pressures and slowing economic growth. For borrowers, it’s a ray of hope after months of financial pressure.

Are Lenders Passing on the Rate Cut?

Yes—many lenders, including major banks, have started passing on the full 0.25% rate cut to customers with variable rate home loans. For example:

A typical borrower with a $600,000 home loan could now save around $92 per month on repayments.

However, if you’re on a fixed rate, this won’t affect you until your fixed term ends.

Will Home Loan Rates Keep Falling in 2025?

While March’s cut is promising, the outlook for the rest of 2025 remains mixed. Here’s what Australia’s big four banks are predicting:

Commonwealth Bank expects more cuts starting September 2025, with the cash rate dropping to 2.85% by mid-2026.

NAB sees the rate going down to 3.10% by the end of 2025.

Westpac is forecasting similar cuts starting in the second half of the year.

ANZ believes the cash rate will bottom out around 3.60% in 2025.

If inflation remains under control, we could see a series of gradual cuts through late 2025 into 2026.

💡 What Should Homeowners and Buyers Do Now?

Now is a great time to review your current home loan. Whether you’re an existing homeowner, a property investor, or a first home buyer, here’s what you can consider:

Refinance your mortgage to take advantage of lower variable rates.

Explore fixed-rate options if you want repayment certainty.

Speak to a mortgage broker to compare lenders and find the best rates for your situation.

👉 Tip: Even a small reduction in your home loan rate can save you thousands over the life of your loan.

📞 Need Help Navigating Your Options?
At Mom and Dad Finance, we specialise in helping Australians make smarter property decisions. If you’re unsure whether to refinance, switch lenders, or lock in a rate—we’ll guide you every step of the way.

✅ Book your free strategy session today and let us help you get ahead while rates are heading down.

📌 Final Thoughts
So, are home loan rates going down in Australia? Yes, they’ve started to, with the March 2025 RBA cut signalling a potential shift in direction. While more cuts aren’t guaranteed, staying proactive can help you save money and reduce financial stress.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.