“My partner and I were expecting further rate decreases following the last one or two decreases we’ve had, so the current increase is definitely disappointing,” she said.

They have decided to sell their newly finished home and pivot to the tiny house movement due to “cost of living and lack of freedom”.

“Humans are not meant to live this way,” she says. “It’s causing a cascade of issues, health issues, a mental health crisis and the fact that so many people aren’t having kids because they simply can’t afford it.”

On Tuesday afternoon the Reserve Bank hiked rates for the first time in over two years in a blow to mortgage holders, who bear the brunt of dealing with an unexpected jump in inflation through the second half of 2025.

The widely anticipated decision marks the end of the shortest rate-cutting cycle in the RBA’s modern history, after three reductions in the cash rate target in February, May and August of last year.

The RBA’s governor, Michele Bullock, said in a Tuesday afternoon press conference that the rise is “the right thing for the economy.”

“It is best if we get inflation under control, and our instrument is the interest rate,” she said. “I understand that people with mortgages find that hard, but the alternative is potentially even harder,” she said.