Westpac hikes home loan rates as it flags budget pressure

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Westpac has raised its home loan variable interest rates by 0.25% per annum, effective to all new and existing customers on 17 February 2026.

Customers paying principal and interest will be notified directly about how their repayments will be affected as well as how they can make changes, the Australian bank said in a statement on 3 February 2026.

Changes can be made via app, website, or by contacting Westpac directly.

Carolyn McCann, chief executive, consumer or Westpac, recognized that the increase may add pressure to households.

“We understand that an interest rate increase may add pressure to household budgets. For those who need support, we are ready to help," McCann said in an online press release announcing the changes.

Housing affordability is a key issue amongst Australians. A Finder poll involving 1,034 respondents found that about 18% have reduced their personal debt and slashed their spending to enable them to refinance or be approved for a home loan in the past 5 years.

Over 1 in 3 (35%) of the survey respondents, conducted in August 2025, believes that they won’t ever be able to afford their own home.

McCann said that Westpac has tools and dedicated teams to assist customers concerned about their repayments or their financial situation.