RBA UPDATE – MAY 2023

RBA UPDATE | Effective May 3, 2023

The Reserve Bank of Australia (RBA) has decided to increase the official cash rate by 25 basis points to 3.85%.

PEXA’s Emerging Mortgage Risk report has identified the most at-risk suburbs entering into mortgage stress. Northbridge, Dural and Avalon Beach in NSW. Balwyn, Balwyn North and Canterbury for VIC. Noosaville, Maleny and Tallebudgera in QLD.

If you have mortgage concerns, the worst thing you can do, is nothing. Working with a mortgage broker or trusted finance professional can help you get on the front foot and minimise the effects of mortgage stress as much as possible.

Today, the Reserve Bank of Australia (RBA) decided to increase the official cash rate by 25 basis points to 3.85%, making April’s decision to hold, short lived. PEXA’s head of research, Mike Gill, said with interest rates continuing to rise and the cost of living squeezing household budgets, there has been a pronounced spike in the number of families facing more immediate mortgage risk. PEXA’s Emerging Mortgage Risk report has found that homeowners in certain locations around Australia are allocating 40-60% of their income to meet repayments – putting them at a high level of mortgage stress.

The report found there were 181 postcodes in New South Wales where homeowners are likely to be at high risk of missing a mortgage repayment by May – with the highest risk suburbs including Northbridge (71.8%), Dural (71.4%) and Avalon Beach (69.4%). In Victoria, 22.3% of all postcodes in the state were at high risk of missing a repayment, up from just two suburbs in December 2020. High-risk locations include Balwyn (74.2%), Balwyn North (71.4%) and Canterbury (70.2%). Followed by Queensland, with only 19 postcodes expected to move into high mortgage risk by May this year, with the most at-risk suburbs being Noosaville (58.3%), Maleny (57.1%) and Tallebudgera (56.9%).

If you have mortgage concerns, the worst thing you can do, is nothing. Working with a mortgage broker or trusted finance professional can help you get on the front foot and minimise the effects of mortgage stress as much as possible.

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