Possibility of OPR hike in March 2027. What happens?
Every time the Overnight Policy Rate (OPR) is hiked upwards, the mortgage payments go up as the interest rate charged would also be increasing at the same time. I see OPR hike as a positive sign too as it meant that people are spending more and Bank Negara Malaysia (BNM) may prefer to keep that spending to be non-speculative instead.
An article in themalaysianreserve quoted CIMB Treasury and Markets Research.
CIMB Treasury and Markets Research now expects Bank Negara Malaysia (BNM) to raise the Overnight Policy Rate (OPR) by 25 basis points, from 2.75% to 3%, in March 2027. The revised forecast reflects concerns that stronger government spending and domestic demand could fuel inflation.
As at 20 October 2026, the OPR remains at 2.75%, following BNM’s decision to maintain the rate in September.
An OPR increase would generally put upward pressure on borrowing costs, although banks’ actual lending rates and the timing of any changes may vary. For property buyers with variable-rate housing loans, higher rates could mean higher monthly instalments or a greater share of repayments going towards interest.
However, CIMB’s forecast is an expectation, not a confirmed BNM decision. The central bank will continue assessing inflation, economic growth and other developments before deciding whether an adjustment is necessary. Do read the full article here: An article in themalaysianreserve
My comments
An expected OPR hike may affect property buyers’ sentiment. Some may decide to wait, hoping interest rates will fall again or property prices will become more attractive. Others may worry that higher monthly instalments will stretch their finances. Yea, maybe an extra RM50 or maybe an extra RM100 but if it’s just 25 basis points, it should not be a worry for monthly mortgage payments. Continuous hikes would be a worry.
But should an OPR increase automatically stop us from buying a property?
My view is that if we genuinely need a property, we should still proceed with our plans, provided we can comfortably afford it.
If we are buying our first home to live in, we need somewhere to stay regardless of whether the OPR is 2.75% or 3%. Waiting for the perfect interest rate may mean postponing an important life decision. Nobody knows for certain when rates will change again.
Just calculate the monthly instalment at a higher rate and check whether we can still afford it. For example, can we manage if our repayment increases by RM200 or RM300 a month? What if household expenses also rise?
If the answer is no, perhaps we should consider a less expensive property.
Remember, an OPR hike can influence sentiment, borrowing costs and property demand, but it does not automatically mean property prices will fall due to people preferring not to buy and thus transactions fall.
Buy because the property meets our needs and budget, not because we are trying to predict interest rates. Happy property hunting, yeah!
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