Millions worry about meeting housing payments – survey

by Mark Rosanes05 Jan 2021

A quarter of respondents in a new survey have expressed concern about their ability to meet housing expenses once the Christmas season ends.

And according to financial comparison site Finder, which conducted the study, that is equivalent to 4.8 million Australians who may find it difficult to come up with the funds needed to make mortgage or rental payments.

The survey involved a representative sample of more than 1,000 respondents, with 16% saying they were “somewhat worried” and a further 9% admitting they were “extremely worried” about meeting housing payments.

The concern is more pronounced for men, with nearly a third, or 31%, admitting being anxious about financing their mortgage or rent after Christmas, compared with 19% of women.

Sarah Megginson, home loans expert at Finder, said that Christmas could push people “over the edge financially,” especially during the pandemic.

“Many households are still facing hardship and relying on stimulus money to get by as the pandemic goes on,” she said. “For families whose income for December is less than it was last year, this can cause significant budget shortfalls and lead to financial trouble. Many will have to choose which bills to fall behind on.”

The research also found that young adults are the most vulnerable age group when it comes to missing housing payments.

A third of the respondents who expressed concern about meeting payments belong to the Gen X and Gen Y bracket, compared to just 5% of Baby Boomers.

The study attributed these figures to the rise in youth unemployment in 2020, which hit a 23-year high of 16.4% in June, leaving many young adults without a means to finance rental or mortgage expenses.

According to the report, Victorian households were most burdened by housing costs, with 37% of residents worried about making rent or mortgage payments once the festive season is over.

Additionally, the study found that rental prices have not fallen in proportion with the recession. Previous CoreLogic data showed, for instance, that the median asking rent in Melbourne last September was $425, just a 2% dip year-on-year, despite Victoria bearing the brunt of the pandemic.

Finder’s analysis of recent Australian Bureau of Statistics data also showed that the total value of owner-occupier home loans in Australia reached a record-high $16.5bn in October, a 24% rise year-on-year.

“With interest rates at record lows, Australians on fixed-term contracts may not be getting the best deal for their home loans,” Megginson said. “Now is a great time to refinance your home loan – just a small change in your rate could end up saving you thousands. Some lenders offer cashback for refinanced loans, so it's worth scanning your options.”