Lenders are raising the cost of buying property by up to 60 basis points as the impact of the "Trump effect" and growing expectations that central bankers are set to end the era of record low rates ripple through global markets.

Rising costs of funding debt are also widening the competitive gap between the big four, which can largely fund lending from customer deposits, and the smaller lenders that are more reliant on capital markets.

It also heralds the beginning of the end for the sub-4 per cent fixed rate offers that have contributed to record levels of switching between lenders by cost-conscious borrowers.

Developers are less likely to squeeze their margins in Sydney where demand remains strong. Dallas Kilponen

ME Bank, which is owned by 29 industry funds, will today announce that it is also raising its variable rates by up to 10 basis points, the first hike in a variable rate in the latest round of increases. Fixed rates are rising by up to 15 basis points.

ME Bank, like some other smaller lenders, has traditionally required on complex securitised funding even though it has been moving to a deposit-based model since the global financial crisis.