In March, before the Reserve Bank of Australia lifted the cash rate from 4.35% to 4.6%, Andrew Clifford switched his variable mortgage to a two‑year fixed‑rate. He said he felt relief but noted that most borrowers are still “doing the heavy lifting” to beat inflation.

According to the RBA, less than 5 % of Australian home loans are on a fixed rate, meaning the vast majority are exposed to changing interest rates.

In the United States, government‑sponsored entities such as Fannie Mae and Freddie Mac guarantee about 70 % of mortgages. A deep secondary market for mortgage‑backed securities lets lenders sell loans to investors, which supports the widespread availability of 30‑year fixed‑rate mortgages.

Professor Richard Holden, a University of NSW economist, says Australia would need government “scaffolding” and a larger 30‑year debt market before lenders could comfortably offer long‑term fixed‑rate products.

In Japan, most mortgages are variable‑rate for up to 35 years, a pattern Dr Doowon Lee of the University of Sydney explains as a result of three decades of extremely low interest rates.

South Korea’s market is different. Dr Lee notes that the most common fixed‑rate loans there last five to seven years, and the spread between fixed and variable rates is relatively small because of the jeonse rental scheme and targeted government policies.

Without a comparable guarantee system, a robust secondary market, and long‑dated government debt, Australian lenders lack the incentives and risk‑mitigation tools that make long‑term fixed loans viable elsewhere. This structural gap keeps the fixed‑rate share low and leaves many borrowers dependent on variable rates.