Aussies cut spending due to mortgage stress

Almost half of Australian mortgage holders (45%) have limited their spending, such as eating out, to deal with their mortgage stress, according to Finder’s “Housing and Market Report: Navigating Refinancing in 2023”.

The study has revealed that homeowners were forced to take ‘drastic measures’ to reduce expenses from skipping meals to cancelling holidays, with 45% of respondents having admitted that they had cut back on eating out and one in three had limited expenses on other non-essentials.

Another 3% of respondents have said that they even moved their child to a different school to limit the costs.

“It’s a very worrying situation for millions of households and is causing a huge disruption to people’s lives. Many Aussies are taking drastic action to avoid mortgage stress,” Richard Whitten, home loans expert at Finder.

According to Finder’s Consumer Sentiment Tracker, three in four Australians (75%) were somewhat or extremely stressed with their current financial situation in September.

Finder analysis of ABS home loans data has revealed a record $22.1 billion worth of mortgages were refinanced in June, with many Aussies refinancing in droves as they struggled with serviceability.

“Refinancing can be a silver lining for homeowners in distress, and Australians are prepared to switch if it gives them more breathing room,” Whitten said.

He said that some people were even refinancing to lengthen their mortgage on a similar rate to bring their monthly payments down.