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Borrowers in New South Wales are feeling the mortgage pinch the most as the rate rises impact their capacity to meet repayments.

This was the main finding of the latest Emerging Mortgage Risk report from PEXA, which explored the impact of rate hikes, steep house prices, and continued cost of living pressure on those who have recently purchased residential property from January 2020 to February 2023.

According to the report, 181 postcodes in New South Wales, representing 46.1% of all suburbs in the state, are at mortgage risk.

These suburbs are mainly concentrated in metropolitan areas, with nearly all the very high-risk postcodes located in Greater Sydney, including Northbridge, Dural, and Avalon Beach.

In Victoria, 74 postcodes or around 22.3% of suburbs reported a high mortgage risk. Metropolitan areas such as Balwyn, Balwyn North, and Canterbury had the highest instances of mortgage risk.

On the other hand, regional postcodes in Queensland were exposed to higher mortgage risk, specifically Noosaville, Maleny, and Tallebudgera.

Only around 19 postcodes in Queensland were at high mortgage risk, representing 8.7% of all suburbs in the state.

How much borrower repayments increased

Median loan repayments increased significantly since December 2020, with recent borrowers needing to fork out additional funds to meet their new repayments.

Based on PEXA’s projections, borrowers in New South Wales will need additional $15,985 per year to meet their loan repayments starting May 2023. This translates to 62.3% increase in mortgage repayments from December 2020.

The rate of increase was higher in Victoria at 67.3% or $13,327 additional repayments annually.

Borrowers in Queensland are also expected to shell out 67% more than what they spent in December 2020 in mortgage repayments, indicating an additional payment of $11,567.

PEXA head of research Mike Gill said the findings of the study goes to show how Australians are squeezing their budgets, with many households facing more immediate mortgage risk.

“In addition to these factors, with an estimated 800,000 fixed rate loans due to expire during 2023 – and reset at a significantly higher cost – it’s easy to see why refinance volumes are at a record high as mortgagees seek to strike a better deal. It’s clear that lending pressure is set to stay in the months ahead,” he said.

Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees Max LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
90%
Featured 4.6 STAR CUSTOMER RATINGS
  • Low rates for purchase and refinancing
  • Simple online application process
  • No fees, unlimited redraws, 0.10% offset
Disclosure
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Disclosure
6.14% p.a.
6.16% p.a.
$2,434
Principal & Interest
Variable
$0
$350
60%
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .

Important Information and Comparison Rate Warning

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