Rates on the table: what an RBA hike really does to tradies’ wallets
The RBA is not talking about cuts. It is talking about holding… or lifting. For some people, that still sounds like background noise from an economist on TV. For tradies, it’s way more personal. It’s tighter mortgages, pricier loans, and every big money decision suddenly needing a second, third and fourth look.
The RBA is not talking about cuts. It is talking about holding… or lifting. For some people, that still sounds like background noise from an economist on TV. For tradies, it’s way more personal. It’s tighter mortgages, pricier loans, and every big money decision suddenly needing a second, third and fourth look.
When rates move, your mortgage, your ute and your jobsite cop it.
We kick off 2026 with a clear message from the Reserve Bank. Inflation has eased, yes, but not enough to relax. The cash rate is sitting around 3.6 percent and, according to analysts and the RBA itself, a 0.25 percent hike is still on the table this year if prices refuse to settle properly. It is not an immediate shock, but it is not great news either for anyone already running tight.
When rates go up, it is not just a number
A 0.25 percent rise sounds small on paper. In real life, it is not. For a tradie on a variable mortgage, that can mean tens or even hundreds of dollars extra every month. And when money is already under pressure from rent, fuel, food and everything else, that extra hit lands hard.
You do not need to be a hardcore property investor for this to matter. Plenty of tradies own one place, or are still trying to buy their first. Higher rates make borrowing more expensive, push banks to tighten lending, and make the idea of buying feel further out of reach.
Simple version: if the RBA lifts rates, banks do not absorb the pain. They pass it straight on. And it lands square on your ribs.
“A rate rise looks tiny… right up until your mortgage smacks you in the face.”
What happens in the banks ends up on site
Rates do not just hit housing. They affect anything bought on finance. Utes, trailers, big machines, expensive tools. When money costs more, decisions slow down. A lot of tradies start stretching what they already have, fixing instead of replacing, and only buying when there is no other choice.
That shift rolls through the industry. If fewer people buy homes, less gets built. If builds slow down, some work cools off. It is not instant, but it is a chain tradies have seen before.
That is why this is not just an economist chat. It is about how many jobs are out there, how many projects kick off, and how much extra pressure gets piled onto an already cooked housing market.
What to do when rates get twitchy
There is no magic fix, but there are a few realities worth facing.
If you are on a variable rate, any rise hits you straight away. It is worth running the numbers properly and not kidding yourself that it will not matter.
If you are looking to buy, higher rates mean the bank lends you less for the same repayment. That changes the game, and it forces smarter financial thinking.
If you are planning to upgrade a ute or buy big gear, 2026 might not be the year to throw everything on finance without a second thought.
This year is not kicking off with cheap money and easy wins. It is starting with caution. An RBA watching inflation closely, and a lot of households, tradies included, walking a fine line. It is not the end of the world. But it is definitely not the year to play tough with your wallet.
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