Households have yet to feel the full impact of the Reserve Bank’s aggressive interest rate increases as hundreds of thousands of people shift to variable mortgage rates over coming months and repayments take up a record share of Australians’ disposable income.
Many borrowers found their repayments jumping three or fourfold, prompting fears of a “mortgage cliff”. While overall borrowing rates have climbed, Ung also found the discounts offered by banks to woo new customers have disappeared. The federal government, which has set a target of 1.2 million new homes by mid-2029, has introduced a range of policies including assistance for local councils to plan and release land for development.
ANZ chief economist Richard Yetsenga says simply increasing supply may not deal with all of Australia’s housing issues.