Perceived mortgage costs nearly double in 1 year: NAB

According to NAB’s latest Consumer Sentiment Survey, 21 per cent of Australian borrowers believe that mortgage costs increased during the first three months (Q1) of the calendar year. 

The figure marked a slight downfall from what was reported in the major bank’s previous findings, which stated that 23 per cent of borrowers across the country felt loan costs spiked during the final quarter of 2021. 

This interpretation was felt at its strongest in Tasmania, with 44 per cent of survey respondents expressing that repayments had lifted over the three-month period. 

This figure marked a significant hike from the 17 per cent reported during Q4 of 2021. 

Comparatively, every other state and territory remained relatively in line with the national average, with Western Australia (23 per cent) and Victoria (18 per cent) being the respective outliers.  

Yet while this figure reflected a potential decline in mortgage costs for the nation at large, this latest percentage is nearly twice to what was reported 12 months ago.

As reflected in NAB’s results, 12 per cent of respondents felt that mortgage costs had increased during Q1 of 2021. 

Further, during the following quarter, only 14 per cent of respondents expressed that mortgage costs had increased, with Tasmania again leading the pack at 27 per cent, while a combined South Australia and Northern Territory reported the smallest cohort (7 per cent). 

But this shift upwards in mortgage costs hasn’t impacted living expenses. According to NAB’s latest results, 12 per cent of borrowers said that mortgage costs had added the most to their cost of living – a result only 1 percentage point lower to what was reported during both Q4 and Q1 of 2021. 

Tasmania reported the least impact, with only 2 per cent stating that it had added to their cost of living, while borrowers in both Victoria and South Australia/the NT were reportedly feeling the crunch the most at 14 per cent each. 

This relative stability was also observed in expectations for property, with owner-occupier intentions dropping year-on-year from 3 per cent to 2 per cent, and investment intentions sliding from a loss of 6 per cent to a loss of 5 per cent. 

However, this lack of appetite for purchasing property mirrored recent findings. The Equifax’s latest Quarterly Consumer Credit Demand Index fell for the first time since 2019, dropping by 4.6 per cent in the year to March 2022. 

[Related: Mortgage demand sinks for 1st time since 2019]