"Increased market pressures, particularly funding costs, have resulted in small rate increases for some fixed home loans for new business," said Steve James, chief executive of Teachers Mutual Bank, one of the nation's biggest mutual.

The rate increases also apply to affiliates Firefighters Mutual Bank and UniBank.

Bluebay Home Loans, a boutique Perth-based lender, which is also raising rates, is telling borrowers it is "not immune" to other lenders increasing their variable rates as a result of rising funding costs.

Bluebay offers self-branded mortgages financed by Adelaide Bank.

Lenders are blaming increased regulatory and wholesale funding costs for the increases to fixed and variable rates property loans. DANIELLE SMITH

Bendigo Bank, which is merged with Adelaide Bank, is increasing owner-occupied principal and interest, interest only, investment loans and lines of credit by up to 16 basis points.

Marnie Baker, managing director, also blames rising funding costs.

"We've absorbed this cost impact to date," Mr Baker said. "We need to consider the needs of stakeholders including customers, shareholders, staff, partners and the broader community." The bank has about 900 outlets across the nation.


Homestart, a South Australian government-backed boutique, is raising rates on one year fixed rates by 20 basis points.

Rates are rising as annual wage growth is remains around 2 per cent and loan repayments have blown out to more than 40 per cent of average after-tax earnings.

The latest round of increases follow another five lenders, including AMP, Bank of Queensland and IMB raising rates by up to 40 basis points.

More lenders are expected to follow as 30 and 90-day bank bill swap rates (BBSW), a short-term money market benchmark interest rate, increase pressure on their ability to offer competitive lending and attractive savings rates, which are needed to help fund borrowing.

But lenders are still competing hard for new borrowers to drive their profits and stimulate growth as real estate markets slow.

There are more than 600 loans with rates below 4 per cent, according to analysis by Canstar.

Bendigo Bank, which is merged with Adelaide Bank, is increasing owner occupied principal and interest, interest only, investment loans and lines of credit by up to 16 basis points.

Major lenders are flexing their balance sheet muscle to fund big discounts off headline rates.

For example, Commonwealth Bank, Westpac Group and Suncorp are slashing honeymoon rates on home loan products with discounts of up to 55 basis points for investors and home buyers on introductory rates.

The new offers enable the banks to beat competition for lucrative new business but will increase repricing pressure for existing medium and long-term borrowers.

Analysts, such as Citi, claim the big four banks, which account for eight in 10 of the nation's mortgages, will raise rates by September by an average of about 8 basis points across their residential product range.