Home News Which home loans offer interest rates below 5%?

Which home loans offer interest rates below 5%?

It's possible to get home loan interest rates below 5% in the current market but you need to know where to look.

Published on 28 Jul 2025

Which home loans offer interest rates below 5%?

It's been a while since we were seeing home loan interest rates below the 5% mark.

Reserve Bank of Australia data shows the last time the average new owner occupier variable home loan rate in Australia was below 5% was in January 2023 when it was 4.96% p.a.

It peaked at 6.28% p.a. in June/July 2024 while the peak of the three-year fixed interest home loan rate for owner occupiers was not far behind at 6.24% p.a. in January 2024.

See also: Current interest rates Australia

But with the current downward cycle of the cash rate unfolding, the market is beginning to see home loan interest rates fall below the 5% mark once again.

At this stage, they're confined to fixed-rate home loans but that's expected to change as the cash rate descends - how far it will go is still anyone's guess.

We'll keep on eye on the best rates for you when it happens but, in the meantime, here are the home loans on the current market with interest rates below 5.00% p.a.

Home loan interest rates below 5%

Greater Bank - 4.94% p.a.

Ultimate home loan fixed for two years (7.07% p.a. comparison rate*), fixed for three years (6.88% p.a. comparison rate*)

For owner occupiers with 80% loan-to-value ratio (LVR). Limited to borrowers from New South Wales, ACT, or Queensland only.

Macquarie Bank - 4.99% p.a.

Basic home loan fixed for two years (5.54% p.a. comparison rate*)

Offset home loan fixed for two years (5.77% p.a. comparison rate*). [Note: offset accounts cannot be linked to fixed rate home loans but can apply to the variable portion of a split loan.]

For owner occupiers with 70% LVR making principal and interest (P&I) repayments.

See also: Macquarie Bank home loans review

Bank of Queensland - 4.99% p.a.

Discount two-year fixed rate (5.64% p.a. comparison rate*)

Discount three-year fixed rate (5.59% p.a. comparison rate*)

For owner occupiers with 80% LVR making P&I repayments.

Australian Mutual Bank - 4.99% p.a.

Special Offer First Home Buyers two-year fixed owner occupier (5.80% p.a. comparison rate*) for first home buyers. Maximum LVR 80%, or 95% LVR with lenders mortgage insurance (LMI).

Special Offer Investment two-year fixed home loan (6.23% p.a. comparison rate*) for new investor loans for borrowers with up to 80% LVR (or up to 70% LVR for land only) borrowing up to $500,000 and making P&I repayments.

For both loans: advanced payments allowable up to $20,000 during the fixed period.

BankVic - 4.98% p.a.

Two-year fixed rate owner occupier home loan (5.53% p.a. comparison rate*) for P&I repayments.

Police, emergency, and health workers may borrow up to 90% LVR with no LMI for certain loan purposes, property types, and locations. Additional repayments up to $10,000 per year. Offset and redraw facilities not available.

Police Bank - 4.99% p.a.

First Home Loan fixed for three years (5.32% p.a. comparison rate*) for owner occupiers with 80-98% LVR qualifying for the First Home Buyer Guarantee Scheme.

Police Value (L23) owner occupier home loans fixed for three years:

(5.60% p.a. comparison rate*) up to 60% LVR
(5.64% p.a. comparison rate*) up to 90% LVR
(5.68% p.a. comparison rate*) up to 95% LVR. (Also available for ACT Land Rent Scheme with up to 90% LVR.)

Police Value (L23) investor home loans fixed for thee years:

(5.68% p.a. comparison rate*) up to 60% LVR (P&I repayments)
(5.71% p.a. comparison rate*) up to 80% LVR (P&I repayments)
(5.75% p.a. comparison rate*) up to 90% LVR (P&I repayments)

[Note: Police Value home loans are only available to current and retired employees of an Australian Police Force or Police organisation, uniformed or civilian.]

Goldrate (L21) owner occupier home loans fixed for three years:

(5.64% p.a. comparison rate*) up to 60% LVR
(5.68% p.a. comparison rate*) up to 80% LVR
(5.71% p.a. comparison rate*) up to 95% LVR. (Also available for ACT Land Rent Scheme with up to 90% LVR.)

Goldrate (L21) investor home loans fixed for three years:

(5.71% p.a. comparison rate*) up to 60% LVR
(5.75% p.a. comparison rate*) up to 80% LVR
(5.78% p.a. comparison rate*) up to 90% LVR

South West Slopes Bank - 4.99% p.a.

Optimum one-year fixed rate home loan (5.99% p.a. comparison rate*) for owner occupiers. Up to $20,000 in additional payments accepted.

Rate reverts to Optimum standard variable reference rate at the end of the fixed rate period.

When will variable home loan rates fall below 5%?

This will all depend on what happens with movements to the official cash rate and, of course, some healthy competition in the marketplace.

Currently, the lowest variable rates on the market are around the 5.40% p.a. mark (some slightly below) with significantly varying comparison rates.

Even with the widely expected 25-basis point cut to the cash rate on 12 August, it is unlikely (but not impossible) variable rates on the home loan market fill fall under the 5% mark in August.

However, variable interest rates with a '4' in front could well be peppering the market after a follow-up cut to the cash rate.

Many market-watchers have earmarked August and November as the most likely months for the Reserve Bank to next lower the rate while some predict the follow-up cut will be in more likely delayed to February 2026.

Stay tuned as we update cash rate and home loan rate movements as they occur.

In the meantime, our articles on variable and fixed home loan rates may provide some useful information.

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Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Loan purpose

Loan amount

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Lender	Home Loan	Interest Rate	Comparison Rate*	Monthly Repayment	Repayment type	Rate Type	Ongoing Fees	Upfront Fees	Max LVR	Tags	Features	Link	Compare	Promoted Product	Disclosure
loans.com.au	loans.com.au Variable Home Loan P&I <90%	5.54% p.a.	5.58% p.a.	$2,852	Principal & Interest	Variable	$0	$530	90%	Owner Occupier Variable Principal & Interest 10% Min Deposit Redraw Extra Repayments More details	Available for purchase or refinance, min 10% deposit needed to qualify. No application, ongoing monthly or annual fees. Quick and easy online application process.	More details	Compare	Promoted	Disclosure
Unloan	Unloan Variable Rate Home Loan LVR < 80%	5.49% p.a.	5.40% p.a.	$2,836	Principal & Interest	Variable	$0	$0	80%	Built and funded by CommBank Owner Occupier Variable Principal & Interest 20% Min Deposit Redraw More details	No application or ongoing fees. Annual rate discount Unlimited redraws & additional repayments. LVR <80% A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.	More details	Compare	Promoted	Disclosure
Ubank	Ubank Flex variable home loan - 100% offset	5.64% p.a.	5.89% p.a.	$2,883	Principal & Interest	Variable	$250	$250	60%	100% offset Owner Occupier Variable Principal & Interest 40% Min Deposit Offset Redraw More details	Easy application. Fast approval. 100% offset. Unlimited additional repayments free of charge. Redraw available - Access additional payments.	More details	Compare	Promoted	Disclosure

Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

Important Information and Comparison Rate Warning

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Denise Raward

Denise Raward is a senior journalist with an interest in macroeconomics, property, and personal finances. She has worked extensively across mainstream media organisations and lectured at Queensland University of Technology, Griffith University, and Bond University. She holds a Bachelor of Business - Communication, a Master of Arts, and RG 146 financial certification in Generic Knowledge, Securities, and Regulation. Joining Savings.com.au in January 2024, Denise strives to deliver financial information in everyday language to help Australians to better understand how to manage their own – and their families' – ongoing financial health.

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We strive to cover a broad range of products, providers, and services; however, we do not cover the entire market. Products in our comparison tables are sorted based on various factors, including product features, interest rates, fees, popularity, and commercial arrangements.

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Comparison Rate Warning and Base Criteria

For home loans, the base criteria include a $500,000 loan amount over 30 years. For car loans, the base criteria include a $30,000 loan over 5 years. For personal loans, the base criteria include a $20,000 loan over 5 years. These rates are only examples and may not include all fees and charges.

*For home loans, the comparison rate is based on a $150,000 loan over 25 years. *For car and personal loans, the comparison rate is based on a $30,000 loan over 5 years. Warning: these comparison rates are true only for the examples shown and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

Monthly Repayment Figures

Monthly repayment figures are estimates that exclude fees. These estimates are based on the advertised rates for the specified term and loan amount. Actual repayments will depend on your circumstances and interest rate changes.

Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you.

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Which home loans offer interest rates below 5%?