Australians are bearing the brunt of a “mortgage cyclone” — with more than one in three homeowners now fitting the standard criteria for mortgage stress.
New consumer research has found 16 per cent of Australians have been hit with rate hikes that have added $1,000 or more in extra mortgage payments every month.
But close to one in three – 31 per cent – of mortgage holders surveyed have never refinanced, despite having a mortgage for more than ten years. A further 1 in 6 are paying roughly half of their income to lenders , and 1 in 25 are coughing up more than 60 per cent of their income to pay for home mortgage charges.
However, some homeowners are facing a sharp cliff coming from a fixed rate starting with a 2, to a variable loan starting with 6, which could mean an extra $780 a month in repayments on a $350,000 home loan over a 25 year loan term. “We’re also seeing cuts to variable rates, like NAB’s 96 basis point cut to its base variable rate home loan for those making principal and interest payments, and the growing number of home loans in the Mozo database starting with 5.”
“In the three months to August 2023 lending for the purchase or construction of a new homes was 30.3 per cent lower than at the same quarter a year earlier,’’ he said.
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