Aussie households have never been this exposed to rate hikes

Advertisement

Financial comparison site Canstar compared the cost of mortgage repayments for those who bought median priced houses in each of Australia’s capital cities in January 2021 versus January 2022, assuming a principal and interest 30-year loan and a 20% deposit.

Despite the ongoing fall in variable mortgage rates over that time (see above chart), the typical homebuyer is paying $461 more per month in repayments than than they would have paid had they purchased the median priced home a year earlier:

Advertisement

This increase in mortgage repayments is due to the sharp appreciation in values over that period, from $623,602 in January 2021 to $778,255 in January 2022.

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.