The new financial year got off with a bang with the RBA announcing another rise in the official interest rate.

The RBA board increased the cash rate from 0.85% to 1.35%, on the back of a similar increase in June.

PropTrack senior economist Eleanor Creagh says many households are sitting on large savings buffers which will help to ease the impact of the recent rate increases.

“For many homeowners, substantial home equity has been accumulated after the significant rise in home prices over the last two years, and some have taken advantage of falling interest rates to pay down debt quicker,” she says.

Mortgage Choice national sales director David Zammit says most lenders have already substantially increased rates on variable and fixed rate home loans.

He says it’s important that borrowers make sure they have the best rates on offer. Mortgage Choice data shows an increase in refinancing activity since the first cash rate rise in May.