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A majority of Aussies feel burdened by their mortgages

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New research from Gateway Bank confirms RBA’s concerns about rising mortgage stress

Sydney, 25 September 2018: The RBA’s recent commentary warning of rising mortgage stress levels across the nation has been validated in a study commissioned by customer-owned Gateway Bank. Findings revealed that a majority (56 per cent) of Australians consider their home loan to be a burden which limits their lifestyle.

Paul Thomas, CEO of Gateway Bank, believes these findings reflect the consistent increase in household debt across the country.

“In the pursuit of getting their foot into the property market, some Aussies have become over-indebted, leading us to record high household debt-to-income ratios of 189 per cent[1]. Add to this the steep decline in household savings, which is currently at one per cent[2], and you have yourself a recipe for mortgage stress.” Thomas said.  

The results also indicate a shift towards an alternative means of property ownership – rentvesting. This year, almost one in ten (nine per cent) of those surveyed were renters who also owned investment properties. Half of those who identified as a rentvestor were Millennial, 38 per cent were Gen X and ten per cent were baby boomers.

Thomas attributes the popularity of rentvesting to increasingly strict lending restrictions and a desire for more affordable routes of property investment but warns people against entering down the path without the proper knowledge required to succeed.  

“The Australian property market is flatlining for the first time in years and lending restrictions are tighter than ever before, so savvy Aussies are looking for other ways to get a foothold into the great Australian Dream,” Thomas said.

“It seems that for almost ten per cent of Aussies, rentvesting has presented an opportunity to enter the property market. However prospective rentvestors should be wary before going down this path, as it does require a lot of consideration. When we look at data from our study this year, rentvestors are under a greater deal of stress (65 per cent) than the general mortgage holder population, which is just a small indication of the challenges presented by rentvesting.” Thomas concluded.

Looking at metropolitan hubs across the country, Adelaide residents topped the nation for mortgage stress, with 63 per cent of Adelaide residents considering their home loans to be a burden. Surprisingly, Sydney-siders boasted the lowest percentage of burdened homeowners, as 54 per cent consider their home loans to be a burden. This was followed by Melbourne (58 per cent), Darwin (61 per cent), Brisbane (61 per cent) and Perth (62 per cent).

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Media contact

For more information or to arrange an interview, please contact: 

Tasha Nabila - PR & Communications Manager

Gateway Bank

02 9307 4359 | 0449 539 654

TashaNabila@gatewaybank.com.au


About the research

The research, commissioned by Gateway and conducted by YouGov Galaxy, was compiled through an omnibus survey, which polled 1,035 respondents across Australia in August 2018.

About Gateway Bank

Gateway Bank is one of Australia’s leading customer-owned banking institutions, serving as a trusted financial partner to its Members for over 60 years’. With over 30,000 Members across the nation, it offers award-winning personal banking products from home loans, car loans, and personal loans to fee free bank accounts, high interest savings accounts and term deposits. With a strong focus on empowering its Members to achieve their hopes and dreams, the Gateway name is synonymous with trust, transparency and reliability.

At Gateway Bank, we’re proud to be small and we’re as human as you are. We boast an overall customer satisfaction rating of 87%, our loan applications are assessed by humans, not a computer and our Members love to recommend us to their family & friends.

To find out more, visit www.gatewaybank.com.au