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The hike trend in home loan rates is starting to manifest in the mortgage levels of suburbs, particularly those with higher median family incomes.

A report from Otivo showed an additional 100,000 Australians have a chance to fall into mortgage stress due as rates increased for the ninth consecutive month.

According to the report, households with weekly incomes ranging $3,300 to $4,600 have the highest instances of mortgage stress.

Weekly income ($)

Mortgage Stressed Borrowers

$1,133 to $1,792

24%

$1,792.00 to $2,050

23%

$2,050 to $2,217

23%

$2,217 to $2,400

22%

$2,400 to $2,700

22%

$2,700 to $2,933

25%

$2,933 to $3,333

27%

$3,333.00 to $4,633

28%

As seen in the table above, it appears households in the middle-income range are less affected by mortgage stress levels, relative than those in the lower and higher ends.

A separate report from PEXA indicated that this year might be a record-year for refinancing, as the “rapid” series of hikes impact borrowers, particularly fixed-rate ones whose terms are expiring this year.

Estimates from the RBA showed that around 800,000 fixed-rate home loans are due to expire this year.

In an episode of the Savings Tip Jar podcast, Shore Financial CEO and Co-founder Theo Chambers said the rate hikes would mean a significant jump in home loan repayments for borrowers.

“It’s going to be painful, surprising, and alarming for homeowners because they’ve had record low interest rates over the last few years, given the RBA has started raising the cash rate more aggressively than ever,” he said.

Suburbs with highest incidence of mortgage stress

The tables below show the suburbs in each capital city with the highest incidence of mortgage stress:

Sydney

Suburbs

Populati on

Mortgage stressed borrowers

Median family income

Lakemba, Wiley Park

12,650

53%

$1,300

Fairfield (NSW), Fairfield

East, Fairfield Heights,

Fairfield West

10,400

50%

$1,325

Burwood (NSW)

17,000

49%

$1,900

Dulwich Hill

13,000

49%

$2,800

Auburn (NSW)

37,000

47%

$1,400

Perth

Suburbs

Populati on

Mortgage stressed borrowers

Median family income

Maylands (WA)

12,000

35%

$2,400

Bentley (WA), St James (WA)

6,050

34%

$1,950

North Perth

8,900

32%

$3,200

Applecross, Ardross,

Brentwood (WA), Mount

Pleasant (WA)

5,150

31%

$2,950

Bicton, Palmyra (WA)

6,700

28%

$2,700

Melbourne

Suburbs

Populati on

Mortgage stressed borrowers

Median family income

Flemington, Kensington

(Vic.)

8,200

67%

$2,650

Caulfield East, Malvern East

11,100

52%

$3,050

Balwyn, Deepdene (Vic.)

7,500

46%

$2,650

Altona (Vic.), Seaholme

6,500

44%

$2,550

Doncaster East

30,000

40%

$2,100

Brisbane

Suburbs

Populati on

Mortgage stressed borrowers

Median family income

Ascot (Brisbane - Qld), Hamilton (Qld)

7,050

50%

$3,050

New Farm, Teneriffe

8,050

40%

$3,350

Annerley, Fairfield (Qld)

7,000

33%

$2,600

Ashgrove

13,000

30%

$3,700

Nundah, Wavell Heights

11,000

26%

$2,750

Adelaide

Suburbs

Populati on

Mortgage stressed borrowers

Median family income

Golden Grove, Greenwith

9,900

11%

$2,250

Klemzig, Windsor Gardens

5,950

11%

$2,000

Aberfoyle Park, Chandlers

Hill, Flagstaff Hill, Happy

Valley (SA)

8,140

8%

$2,275

Morphett Vale, Woodcroft (SA)

17,000

6%

$1,750

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Photo by Karolina Grabowska from Pexels.

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