Nearly 4 in 5 Australians are making cuts to pay mortgages

Aggregator Mortgage Choice’s recently released Home Loan Report has found that 78 per cent of borrowers have reported that they’ve made sacrifices to keep up with their mortgage repayments over the last 12 months.

The research, commissioned through Honeycomb Strategy, found that the high cost of living and dramatic interest rate rises have put more borrowers under financial pressure in the last year.

Eating out less frequently was the most common sacrifice from the 1,000 consumers surveyed at 54 per cent, followed by cutting back on entertainment (50 per cent), delaying or cancelling holidays (34 per cent), and cancelling subscription services (29 per cent).

Furthermore, the research found that 18 per cent of respondents have taken on additional work or side jobs in order to cope with mortgage repayments, while 7 per cent sought out financial assistance from family members.

Commenting on the findings, Mortgage Choice CEO Anthony Waldron said that consumers have made it “loud and clear” that they’re still feeling the pinch when it comes to keeping up with mortgage repayments.

Similarly, research released by Finder found that 53 per cent of Australians have delayed life milestones due to cost-of-living pressures, with personal finance expert at Finder, Sarah Megginson, stating that cost-of-living pressures were “stopping many in their tracks”.

Average loan sizes have increased

Data from Mortgage Choice’s broker network has also revealed that the national average loan size rose to $583,416, representing an increase of 8.9 per cent annually (comparative to March quarter 2023).

The report revealed that the average loan size has increased in almost every region analysed, with South Australia/the Northern Territory (up 13.2 per cent to $527,868) and Western Australia (up 11.6 per cent to $495,434) in the lead.

Queensland came in third place for loan size increases, up by 10.5 per cent to $543,277 followed by NSW/ACT by 7.7 per cent ($673,375) and Victoria/Tasmania by 5.9 per cent ($614,667).

Waldron said: “In the first quarter of 2024, we saw submission values and the average loan size increase year on year. Our brokers in Perth are reporting that their market has been reinvigorated over the last year, driven by a more stable interest rate environment, high demand.”

These increases are reflective of the steadily rising home prices over the last 16 months, with both CoreLogic and PropTrack recording growth in prices of 0.8 per cent and 0.3 per cent (respectively) on a national level.

[RELATED: Delayed home buyers looking to enter property market in 2024]

Adrian Suljanovic is a journalist at Broker Daily with more than two years experience reporting on all facets of the third party distribution channel.

Adrian has written for a range of business and finance titles including IFA, Investor Daily and Lawyer’s Weekly before joining the mortgages team in 2022.

He graduated from the University of Wollongong in 2021 gaining a Bachelor of Communication & Media with a major in Digital & Social Media.

E-mail Adrian at: This email address is being protected from spambots. You need JavaScript enabled to view it.