Justin Fabo from Antipodean Macro posted the following chart showing that Australians are paying some of the highest mortgage rates in the developed world.
Following three 25 bp rate cuts from the Reserve Bank of Australia (RBA), the weighted-average interest rate on outstanding housing loans in Australia has declined by 69 bps from the peak as of October.
However, financial markets are now tipping that the RBA will lift the official cash rate (OCR) twice in 2026, which would take the OCR back up to 4.10% from 3.60% currently.
As illustrated below by Shane Oliver at AMP, Australia’s official interest rates are also forecast to be among the highest in the developed world in 2026, according to the latest market pricing:
Source: Shane Oliver
Australia’s rise in interest rates comes at the same time as our debt-to-disposable income is among the highest in the developed world:
Thus, Australians will inevitably be left paying a higher share of their incomes on servicing mortgage debts than residents of other nations.
This is what happens when you let your housing market become a speculative asset and structurally undersupplied.
You end up with a nation of housing haves and have-nots and mortgage serfs.
