When do the Big 4 variable rate hikes from the May 5 RBA decision take effect?

All four major banks (CBA, Westpac, NAB, ANZ) confirmed full 25 basis point variable rate pass-throughs within hours of the May 5 RBA decision. The new rates take effect from Friday May 15, 2026. The first repayment at the new rate typically lands four to six weeks later, depending on your billing cycle, so most investors will feel it on June statements.

How much will the May 15 variable rate hike add to a typical investor mortgage?

On a $750,000 interest-only investor loan moving from a 6.65% average variable rate to about 6.90%, the 25 basis point lift adds roughly $156 a month, or about $1,875 a year before tax. On a $1 million loan, the bill is closer to $208 a month or $2,500 a year. The interest is fully tax-deductible, so the net cost in a 37% bracket is around $98 a month per $750k of loan.

How many Australians does Roy Morgan project will be in mortgage stress after May 15?

Roy Morgan models that the share of borrowers 'at risk' of mortgage stress rises to 30.4% once the May 5 hike is fully passed through, equivalent to 1.64 million Australians. If the RBA hikes again in June to 4.60% (the SoMP technical assumption), the at-risk count rises to 1.67 million, up 219,000 from the pre-May position. National Debt Helpline calls in April were already up 21% on the same month last year.

What did the PropTrack April 2026 Home Price Index show?

PropTrack's national index fell 0.1% in April 2026, the first monthly decline of the year. Capital city prices fell 0.2%. Sydney was down 0.5% and Melbourne down 0.3%, while Hobart rose 0.3% and Brisbane, Adelaide and Perth each rose 0.2%. PropTrack's read confirms the Cotality April HVI release a week earlier and points to a clear loss of momentum across the housing market.

Can I still refinance into a sharper investor rate before Friday?

Most lenders require 30 to 45 days for an investor refinance to settle, so a refinance you start today will land at the new (post-pass-through) rate environment. The window that does still matter is requesting a discretionary discount or a fixed rate lock with your existing lender. Some non-major lenders are holding off on the full pass-through to compete for refinances, particularly for low-LVR investor loans, so a price-match call this week is worth the 20 minutes.

How does APRA's debt-to-income cap affect investor refinancing in 2026?

From 1 February 2026, APRA caps banks at 20% of new mortgage lending where the debt-to-income ratio is 6.0 or higher, applied separately to investor and owner-occupier portfolios. Investors with multiple properties or high gearing can find themselves on the wrong side of the cap when trying to refinance or top up. High DTI lending to investors hit roughly 10% of new investor loans in the September quarter and is forecast to keep rising, so the cap is starting to bind.

Roy Morgan models 1.64 million Australians 'at risk' as Big 4 variable rates lift Friday

This article is general information only and does not constitute financial or tax advice. Consult a qualified tax professional for advice specific to your situation.

Key takeaways

The May 5 RBA hike to 4.35% becomes a real cash flow event on Friday May 15, when all four major banks pass through the full 25 basis points to variable rates. The first higher repayment lands on most investor statements in June.
Roy Morgan models that 30.4% of Australian borrowers, or 1.64 million people, will be 'at risk' of mortgage stress once the May hike washes through. A June hike to 4.60% lifts the count to 1.67 million, an extra 219,000 stressed borrowers in two months.
PropTrack's April Home Price Index recorded the first national price fall of 2026 (-0.1%), with Sydney down 0.5% and Melbourne down 0.3%. The data confirms the Cotality April HVI and the auction clearance signal.
The average variable rate sits near 6.65% pre-pass-through and lifts to about 6.90% from Friday. On a $750,000 interest-only investor loan, that is $156 a month before tax, $98 net for a 37% bracket landlord.
APRA's debt-to-income cap (in force from 1 February 2026) limits banks to 20% of new mortgage lending at DTI of 6.0 or higher, on a per-portfolio basis. Investor refinancing options are genuinely tighter than they were six months ago.
The Westpac-MI Consumer Sentiment release lands Tuesday May 12 and is the next read on whether the May hike has broken household appetite. ABS April Labour Force prints Wednesday May 21.

This article is general information only and does not constitute financial, tax, or investment advice.

The May 5 RBA decision lifted the cash rate to 4.35% in an 8-1 board vote. The headline news ran for three days. The bill arrives on Friday.

All four major banks confirmed full 25 basis point variable rate pass-throughs within hours of the decision, with the new rates taking effect from Friday May 15. The first higher repayment will land on most investor statements in June, depending on billing cycle. That five-day window between today and Friday is the last chance to do anything that genuinely changes what the rest of 2026 looks like for an Australian property investor.

Three things have stacked up while the news cycle has been on the cash rate. PropTrack confirmed the first national price fall of 2026 in its April release. Roy Morgan modelled the stress flow-through at 1.64 million Australians once the May hike washes through. And APRA's debt-to-income cap, in force since 1 February, is genuinely starting to bind on investor refinances. Here is the five-day checklist.

The Pass-Through, Bank by Bank

The Big 4 announcements came in a rolling order on Tuesday May 5 and Wednesday May 6. CBA went first, then NAB, ANZ and Westpac. All four chose 25 basis points across the board, all four picked Friday May 15 as the effective date, and none of them made any visible move on savings rates in the same announcement window.

Bank	Variable rate move	Effective date	Comment
CBA	+25bp on all variable home loans	Fri 15 May 2026	First major to announce. No change to investor-only specials
NAB	+25bp on all variable home loans	Fri 15 May 2026	Followed CBA within four hours
ANZ	+25bp on all variable home loans	Fri 15 May 2026	Bundled with savings rate notice the next day
Westpac	+25bp on all variable home loans	Fri 15 May 2026	Same effective date despite earlier "May 22" briefing

Sources: Canstar pass-through summary and The Nightly.

The non-major picture is more interesting for landlords looking to switch. Finder is tracking every lender as they announce, and a handful of second-tier lenders have either delayed pass-through or moved by less than 25bp on certain investor variable products. Macquarie and Virgin Money have moved 25bp in line with the majors. ING, Bankwest and several mutuals have not yet finalised their position on investor variable products as of Friday May 8. That is a price-match opening you can act on this week if your loan-to-value ratio is below 70% on the property in question.

What Friday Costs at Typical Investor Loan Sizes

Average variable mortgage rates were near 6.65% in April, per savings.com.au market data. Friday's pass-through pushes that average closer to 6.90%. The interest-only equivalent is roughly 7.05% to 7.20% depending on lender and LVR.

Worked examples on the typical investor loan sizes our calculators are seeing the most use on:

Loan size	Monthly cost of the 25bp lift	Annual gross	Net cost in 37% bracket
$400,000	$83	$1,000	$52
$600,000	$125	$1,500	$79
$750,000	$156	$1,875	$98
$1,000,000	$208	$2,500	$131
$1,500,000	$313	$3,750	$197

These numbers assume an interest-only loan, which is the default treatment for most landlords. If you are on principal and interest, the absolute monthly bill is higher (because principal also moves) but the deductible portion is unchanged. The net cost line is what actually leaves your pocket each month after the deduction is claimed at the end of the year.

The bigger story is the cumulative number. The cash rate has lifted 75 basis points since the start of 2026. On a $750,000 investor loan, that is roughly $469 a month, or about $5,625 a year before tax, on top of where you started in January. If the May SoMP technical assumption to 4.70% plays out in full, the cumulative cost from January is closer to $7,500 a year on the same loan.

For a portfolio investor running three or four loans, the year-on-year cash flow difference is large enough that it deserves a dedicated line in the cash flow forecast. Plug your actual loan balances into the mortgage repayment calculator at 6.90% and again at 7.20% to see what the spread looks like.

Loan amount

Interest rate

Loan term (years)

Repayment type

Enter your loan details to calculate mortgage repayments.

Roy Morgan: 1.64 Million At Risk

The Roy Morgan modelling is the cleanest read on what the May 5 hike does to household balance sheets. Pre-hike, the share of borrowers 'at risk' of mortgage stress sat at roughly 28.5% of mortgage holders. Post-hike, that figure is forecast to climb to 30.4%, equivalent to 1.64 million Australians. A June follow-up to 4.60% would push the count to 1.67 million.

The relevant number for property investors is two layers down. The Roy Morgan stress definition catches borrowers paying more than 25 to 45% of after-tax household income into the loan, depending on income tier. That is a household stress measure, not a property stress measure. But two things filter through:

Tenant cash flow stress is now a real default risk vector. Vacancy rates are still tight at SQM's 1.0% national reading, but the tenant base is moving into the same after-tax-income squeeze landlords are. Arrears risk is starting to show up in PEXA settlement data and in agent collection reports. If you are setting a new lease in May or June, run the affordability check on actual after-tax income, not the headline gross.
Refinancing-out stress is sitting one notch above default stress. Investors holding multiple properties at high LVR often look fine on a single-loan stress test but fail when total interest is summed across the portfolio. The Roy Morgan extremely-at-risk band (where even interest-only payments exceed a defined share of household income) is where forced-sale risk lives. It is small in absolute terms, but it is rising.

Roy Morgan chief executive Michele Levine made the same point publicly last week: unemployment, not interest rates, is the variable that does the most damage to mortgage stress over a full cycle. The April Labour Force release on Wednesday May 21 will be the first test of whether the labour market is starting to give. The unemployment rate has held near 4.1% through the first quarter, but ABS is modernising the survey from April, so the headline print may carry a wider error band than usual.

National Debt Helpline call volumes are already moving. April 2026 calls hit 13,933, up from 11,554 in April 2025. That is a 21% year-on-year lift in people calling for help with debt, three weeks before the May hike has even reached statements.

PropTrack Confirms the Cotality Call

PropTrack's April 2026 Home Price Index recorded a 0.1% national fall, the first monthly decline of 2026. Capital city prices fell 0.2%. The detail tracks the Cotality April HVI almost line for line:

City	PropTrack April	Cotality April
Sydney	-0.5%	-0.6%
Melbourne	-0.3%	-0.6%
Brisbane	+0.2%	+1.1%
Adelaide	+0.2%	+1.2%
Perth	+0.2%	+2.1%
Hobart	+0.3%	n/a published

PropTrack runs slightly cooler than Cotality on the small-capital prints, but the direction of travel is identical. Both data series now show three consecutive months of negative growth in Sydney and Melbourne. PropTrack added the observation that nearly half of all SA4 regions recorded price declines in April, which is the broadest-based pullback the index has measured in this cycle.

The unit story is also worth noting. Capital city house prices fell 0.2% in April but units were flat. PropTrack's reading is that borrowing capacity is now constrained enough that buyers are concentrating on the cheaper end of the stock, which is supporting unit prices even as houses give back ground. For investors holding house portfolios in the inner east of Sydney or inner south of Melbourne, that is a relative-performance signal. For investors looking to deploy into Brisbane, Adelaide or Perth units, it is a buy-side note worth pulling apart.

APRA's DTI Cap Is Now Binding

APRA's debt-to-income cap took effect on 1 February 2026 and limits ADIs to 20% of new mortgage lending at DTI of 6.0 or higher. The cap applies separately to investor and owner-occupier portfolios on a quarterly basis. Bridging loans for owner-occupiers and loans for new construction are exempt.

The latest APRA Quarterly ADI Statistics show high-DTI lending to investors hit roughly 10% of new investor loans in the September quarter, the highest level since 2023. APRA flagged that high-DTI investor lending is forecast to keep rising through this part of the cycle, which is why it activated the cap.

For investors planning a refinance or top-up between now and August, the practical effect is:

Total household debt over six times gross income is now a hard barrier at most lenders. Some lenders are pricing high-DTI applications inside the 20% bucket aggressively to win the business. Others are simply declining at the policy boundary.
Pre-approvals issued before 1 February under the older policy are still good through their stated expiry, typically 90 days. Anything written from February onwards reflects the new framework.
Top-ups against existing investment properties hit the same DTI test as a new purchase. If you are planning to use equity to buy property number two, three or four, the gating constraint is no longer just LVR.

Talk to your broker before requesting any refinance or top-up. Knowing your DTI to two decimals before the bank does is the difference between a clean approval and a 'declined' that goes on your record.

The Five-Day Landlord Checklist

Five things to do between now and Friday May 15.

1. Lock in the discretionary discount with your existing lender. Call the retention team at your current bank and ask for the new rate they would offer to keep your business. The retention discount on investor variable loans is currently sitting at 50 to 80 basis points off the carded rate at most majors, depending on LVR and the size of the relationship. Pre-pass-through is the easiest moment of the cycle to win this discount without a full refinance.

2. Recheck the fixed rate menu. Big 4 investor fixed rates pushed above 6.00% in April and have continued to firm since the May 5 hike. The current spread between a 1-year fixed and the new variable rate is roughly 25 to 40 basis points (variable lower). The 2-year and 3-year fixed rates sit roughly in line with variable. If your view is that the cash rate finishes the year above 4.50%, locking the 1-year is a defensible position. If you think the SoMP path is too hot, hold variable.

3. Run the cash flow forecast at the SoMP rate, not just the May 15 rate. Plug your loans in at 6.90% (the May 15 number) and at 7.20% (a 4.70% cash rate, end-of-year SoMP path). The latter is the level the RBA itself is currently working off in its central case. If your cash flow falls over at 7.20%, you have a planning problem to solve before Christmas, not a panic problem to solve in November.

4. Audit your deductions one more time before EOFY. Higher interest is fully tax-deductible against rental income. The deduction is only worth what you can substantiate. With interest, insurance, council rates, strata levies and tradie callouts all repricing higher in 2026, every dollar should be linked to the property it relates to and supported by a receipt. Propkt's expense tracking dashboard automates the linkage so the EOFY package your accountant gets in July is clean. The tax deductions landlords miss list is worth a re-read this weekend.

What Lands This Week

The next ten days have three releases that will reset where the rates conversation goes from here.

Tuesday May 12, 11.00am AEST. Westpac-MI Consumer Sentiment for May. The April release fell 12.5% to 80.1, a 2.5-year low, on the back of fuel prices and the rate hike. May is the first read on whether the May 5 hike compounds the household pessimism or whether the labour market is keeping confidence afloat.
Tuesday May 13, 11.30am AEST. NAB Monthly Business Survey for April. Watch the labour cost component and the forward orders index for the cleanest read on whether the inflation problem is starting to break.
Wednesday May 21, 11.30am AEST. ABS Labour Force April 2026. The first labour print since the survey modernisation. Unemployment near 4.1% has been the macro buffer that has let the RBA keep hiking without political cover collapsing. Any move above 4.3% changes the June meeting calculus.

The June RBA decision is on Tuesday June 9. The cash rate futures market is currently pricing roughly a 60% probability of a follow-up 25bp hike at that meeting. The May SoMP path implies one more hike before year-end. The data drops between now and June 9 will tell us which one is right.

Bottom Line

For an Australian property investor in May 2026, the immediate task is mechanical. Friday's pass-through is locked in. The cash flow forecast for the next quarter needs to reflect the new rate. The bank discount is winnable this week if you ask for it.

The bigger task is positional. PropTrack and Cotality have both called the turn in the eastern capitals. Roy Morgan has the household stress count climbing past 30%. APRA's DTI cap is genuinely tighter than the framework it replaced. None of those are reasons to sell. They are reasons to know the position you actually hold, on the day the data prints, with the loan numbers and deduction trail current to the dollar.

The investors who run cash flow forecasts at 7.20% this weekend are the ones who will not be surprised by the November statement.