Business · Economy · 2 hrs ago
Australian mortgage repayments more than double as first-home buyers retreat
Australian mortgage repayments have more than doubled in four and a half years, rising from $2,354 to $4,819 a month for a typical new loan.
The Reserve Bank of Australia’s cash rate rose from 0.1% to 4.6%, pushing mortgage interest rates higher.
Higher rates and loan costs are squeezing buyers, while rising rents and living costs make it harder for younger people to save a deposit.
First-home buyer demand fell 22.1% in the year to September, with the biggest declines in Queensland, the Australian Capital Territory and New South Wales.
The decline is deepening despite recent property price falls, which have not yet brought homes back to their prices of four years ago.
Inflation reached 4.3%, increasing the chance of another Reserve Bank rate rise in November.
A further rise could make borrowing harder, and financial markets put the chance of another increase by December at 80%.
The monthly repayment on a typical new 30-year Australian home loan has risen to $4,819 from $2,354 in April 2022.
The Reserve Bank of Australia’s cash rate rose from 0.1% to 4.6% over four-and-a-half years, driving most of the increase.
First-home buyer demand fell 22.1% in the year to September, with the largest declines in Queensland, the ACT and New South Wales.
Higher interest rates, strict serviceability tests and cost-of-living pressures are weighing on younger buyers.
Markets were forecasting an 80% chance of another RBA rate rise by December.
- Who
- Australian mortgage borrowers and first-home buyers.
- What
- Typical new mortgage repayments have more than doubled as first-home buyer demand has declined.
- When
- Repayments rose between April 2022 and the time of the report, published 30 October 2026.
- Where
- Australia.
- Why
- The rise in interest rates drove most of the repayment increase; high rates, strict serviceability tests and cost-of-living pressures also weighed on first-home buyers.
This story does not have two clearly opposing sides.
A typical new 30-year mortgage cost $2,354 per month, and interest rates started increasing.
The RBA cash rate rose from 0.1% to 4.6%.
First-home buyer demand fell 22.1%, according to Equifax.
Stockhead reported the typical new mortgage cost had risen to $4,819 per month.
- Typical monthly repayment
- $4,819, compared with $2,354 in April 2022
- Average owner-occupier mortgage
- $731,000, compared with $603,000 in 2022
- RBA cash rate
- 4.6%, up from 0.1%
- Mortgage interest rates
- 6.91%, up from 2.41%
- First-home buyer demand
- Down 22.1% in the year to September
- Forecast chance of a rate rise
- 80% by December
What people are saying
This is an ugly number for the RBA and significantly strengthens the case for another rate hike next week
Combined with strict serviceability testing, high interest rates and broader cost-of-living inflation are eroding confidence
Every time the RBA fires up a rate rise it reduces someone’s maximum homebuying budget for an average income earner by $10,000 or $12,000.