Top 10 suburbs face greatest mortgage stress after interest rate hike

Today’s cash rate hike will hit areas in Australia’s largest cities and a number of regional hotspots in NSW.

Homeowners in NSW and Victoria will be hardest hit by the historic RBA rate hike, with affluent suburbs expected to take a hit as interest rates rise.

Finder compared average monthly mortgage repayments to monthly household income for suburbs across Australia to determine the top 10 mortgage-stressed suburbs.

The comparison website’s analysis found that homeowners in Sydney’s Darlington are most likely to experience mortgage stress, with average home loan repayments accounting for 105% of median household income.

Blairgowrie (88 percent), a seaside town south of Melbourne’s CBD, and Mullumbimby (85 percent) near Byron Bay are also expected to experience similar pressures, with repayments making up a significant proportion of average monthly income.

The chart calculated the average real estate price of each suburb based on recent sales of both homes and units. Suburbs in the top 20 percent of household income were also excluded from the list.

The study has some limitations, such as not being able to distinguish the number of suburban homes that are not owned by locals and higher rates of retirees affecting the income data.

The data also uses household income figures recorded six years ago in the 2016 census.

The full list of the worst affected suburbs can be viewed below.

The social housing advocacy group Everybody’s Home surveyed more than 52,000 households across Australia to determine which suburbs were most at risk of falling behind on mortgage payments.

It found that Chifley’s Sydney Labor seat, which includes Mount Druitt and Rooty Hill, registered 73.6 percent of households under stress.

Mitchell’s more affluent electorate, currently held by the Liberal Party, which includes the suburbs of Baulkham Hills and Winston Hills, is under a high level of stress, with 73 percent affected.

In southern Sydney, 70 percent of mortgage holders in Barton’s Labor seat, which includes Rockdale and Hurstville, also face mortgage stress.

Financial stress was defined as having less than 5 percent of income after expenses.

Australia hit by historic interest rate hike

The RBA’s announcement marks the first rate hike in 11 years — since November 2010 — and is a desperate attempt to contain skyrocketing inflation, which has hit 5.1 percent annually, and push prices down at the fastest rate. has increased for two decades.

While yields were widely expected to rise, most experts predicted a much more modest increase of 15 basis points.

Claire Victory, the national president of the St Vincent de Paul Society, criticized the fact that the lowest earning Australians had taken another blow in the run-up to the federal election.

“Today’s rate hike will be another kick in the teeth for Australians living in poverty, who are already straining every dollar,” said Ms Victory.

“The rising cost of living, the shortage of affordable housing, increasingly precarious work and stagnant wages are making it virtually impossible for a growing number of Australians to survive.”

The ALP wasted no time in kicking the Prime Minister after the announcement on Tuesday afternoon.

“It was hard enough making ends meet under Scott Morrison and today it got even harder for millions of Australians,” Labor leader Anthony Albanese and shadow treasurer Jim Chalmers said in a joint press release.

“Even before today’s decision, Australians under his care were facing a full-blown cost of living crisis.

“Scott Morrison’s economic credibility was already tattered, now it’s completely tattered.”

While a rate hike to 0.25 percent is relatively small, economists believe the RBA won’t stop there, and some experts predict interest rates will rise to 2.5 percent by the end of 2022.

Senior economist at Nomura Australia and rate strategist Andrew Ticehurst recently said: The Daily Telegraph they think interest rates will rise monthly until December, which means we can expect a rate hike every month until Christmas.

According to comparison site Rate City, a rate increase of up to 0.25 percent would translate into a $39 increase in repayments for the average owner-occupier with $500,000 in debt and 25 years left — a figure that will rise to $511 per month. if the spot rate continues to rise to 2 percent, as predicted.

Sally Tindall, Rate City’s director of research, said borrowers should “be aware that the RBA doesn’t stop at just one rise.”

“The RBA will likely raise the spot rate several times over the next six to 12 months as it works to bring inflation back under control,” she explained.

“If the cash interest rate hits 2 percent in May next year, someone with a $500,000 loan and 25 years to go would be looking at a total increase in their monthly payments of $511.

“That will be a lot for many borrowers, especially anyone who is already struggling to add up the monthly budget.

“Variable rate customers don’t have to take these RBA increases lying down. If you haven’t had a health check on your mortgage recently, now is the time to do so.”

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