Deciding whether to fix or vary your investment loan rate involves weighing potential interest rate fluctuations against your financial risk tolerance, particularly as you prepare to sell a property. As of December 2025, this is a common consideration for Melbourne investors.
Currently in Melbourne, the Reserve Bank of Australia’s cash rate influences variable loan rates. Many investors with properties in the Eastern Suburbs – areas like Balwyn and Doncaster where family homes are in high demand – are assessing their options. Fixing your rate provides certainty, which can be helpful when budgeting for property preparation costs. These costs, typically between $2,500 and $9,500 for styling and professional photography, are a key part of maximising your sale price in 2026. However, if rates fall, you’re locked in. Varying allows you to benefit from potential decreases, but exposes you to increases. A common strategy we see is investors reviewing their loan options 6-12 months before listing, factoring in the typical 4-6 week campaign period. The market forecasts a moderate growth of 3-6% for 2026, so understanding your cash flow is vital. Fletchers’ agents regularly discuss market conditions with clients, helping them understand how interest rate movements might impact their selling strategy.
Ultimately, the choice between fixing and varying your loan rate is a personal one, dependent on your individual circumstances and risk appetite.