Mortgage arrears edged lower in the June 2025 quarter as cash rate cuts gave some households temporary relief, according to the latest APRA figures.
The value of home loans in arrears by 30 to 89 days fell to 0.55% of all credit outstanding, down from 0.60% in the previous quarter. Non-performing mortgages, those overdue by 90+ days or impaired, also eased to 1.07% of outstanding loans.
“Rate cuts are giving some households just enough breathing room to get back on top of their repayments,” Canstar.com.au data insights director Sally Tindall (pictured above) said. “It’s a welcome reprieve, but it doesn’t mean the mortgage pain is over.”
Additional figures from Roy Morgan echo this trend, with the share of mortgage holders “extremely at risk” of stress easing from 19.7% in June 2024 to 18.5% in June 2025. Broader stress levels also declined, falling to 27.8% from 30.3% a year earlier, covering 1.5 million households.
Tindall noted that for an average owner-occupier with a $600,000 debt, repayments have dropped by around $272 a month, easing pressure but not erasing financial strain.
At the same time, new lending surged to $187.6 billion in the June quarter, up 21.3% from March – the highest on record.
“New lending has gone through the roof, with more than $187 billion in mortgages funded in just three months. Buyers are clearly back in force, spurred on by lower rates, however, with rising property prices, households are also taking on bigger debts,” Tindall said.
Brokers’ market share also reached a new peak, with 63.4% of loans written via third parties such as mortgage brokers.
“The data also confirms that brokers are continuing to win the tug-of-war for new customers,” Tindall said. “With almost two-thirds of new term loans now written through a third party, according to the APRA data, borrowers are clearly leaning on expert help to navigate the mortgage maze.”
Offset account balances fell by $5.7 billion in the June quarter to $301.9 billion, a 2% decline. APRA noted this reflected end-of-financial-year drawdowns, although balances remain higher than a year ago.
“The drop in offset balances at the end of the financial year suggests some households may have dipped into their savings to shop in the sales or pay down debt,” Tindall said. “However, compared to a year ago, balances are still up, showing that plenty of people are getting ahead on their mortgages where they can.”
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