It was the news that homeowners with a mortgage across Australia were bracing for - and it happened.
The RBA raised rate by 0.25 per cent, as expected, for the tenth consecutive month at its monthly interest rates meeting with the RBA announcing that the Board had raised the official interest rate by 25 basis point or 0.25 per cent to 3.6 per cent..
"Global inflation remains very high" and "its is some time before inflation is back to target rates."" RBA Governor Philip Lowe said in a statement on why the decision to rise was made.
He said however inflation in Australia looked to have peaked, however some areas such as rents were continuing to skyrocket.
"Rents are increasing at the fastest rate in some years, with vacancy rates low in many parts of the country.," RBA governor Philip Lowe said in a statement.
Research from Canstar shows another 0.25 per cent cash rate rise in March will increase mortgage repayments on a $500,000 loan over 30 years from $2,103 in April 2022 to $3,154 per month. This will see borrowers forking out an extra $1,051 per month or $12,612 per year.
In Sydney, where the median house price sits at $1,006,923, interest rises would add up to $5081 a month - an increase of $132 (based on 0.25 rise).
On a mortgage for a median price house in Melbourne of $743,554 monthly rates would sit at $3752 - a $97 increase.
And in regional Australia nationwide - where the median house price sits at $575,916 - monthly mortgage payments are set to jump to nearly $3000. Monthly repayments would be $2906, a $75 increase for the month of March.
Borrowers who took out loans during the last two years are set to be particularly vulnerable.
"There is a sense of urgency added when you consider that around one-third of all home loan debt is on loans taken out over the last two years when property prices were high," said Canstar's finance expert, Steve Mickenbecker.
"Values are now being whittled back and disappearing equity is piling on further pressure."
After continues months of rate rises since last April, some borrowers are now really starting to feel the heat.
"Households paying off a loan on either their own house or on an investment property are right at the pointy end of interest rate increases," Mr Mickenbecker said.
That pain is widespread with 36 per cent of homeowners said they struggled to pay their mortgage in February, according to Finder's Consumer Sentiment Tracker.
Graham Cooke, head of consumer research at Finder, said it was bad news for homeowners already doing it tough.
"While homeowners deserve a break from the relentless increase in pressure, we can expect ever more hikes from the RBA this year," Cooke said.
According to the RBA's statement released on the interest rate rise is yet to be still fully felt by borrowers.
"The Board recognises that monetary policy operates with a lag and that the full effect of the cumulative increase in interest rates is yet to be felt in mortgage payments," Mr Lowe said.
"Some households have substantial savings buffers, but others are experiencing a painful squeeze on their budgets due to higher interest rates and the increase in the cost of living. Household balance sheets are also being affected by the decline in housing prices."
