Perth, Feb 4: It was news few wanted to hear, but many had expected it.
Today, millions of Australian borrowers were already stretched before the Reserve Bank’s latest interest rate hike, according to new research from Finder.
Finder’s research shows the average mortgage holder would need their interest rate to fall to 4.6% to be relieved of financial stress, highlighting how little buffer many households now have.
More than 1 in 3 homeowners (35%) — equivalent to around 1.15 million Australians — said they struggled to pay their mortgage in January, based on data from Finder’s Consumer Sentiment Tracker (CST).
While this figure is slightly down from 36% in January 2025, it remains well above the 24% recorded in January 2022.
The pressure is already translating into missed repayments.
Twelve per cent of borrowers say they have missed at least one mortgage repayment in the past six months, according to January 2026 CST data. This includes 6% who missed one repayment and another 6% who missed more than one.
Housing affordability concerns remain entrenched, with 36% of Australians who do not yet own a home saying they do not believe they will ever be able to afford one.
Richard Whitten, home loans expert at Finder, said many households were already under significant pressure before the latest move by the Reserve Bank of Australia.
“More than one in three homeowners were struggling to pay their mortgage before the RBA hiked the cash rate in February,” Whitten said.
“Even a small rise in interest rates could push thousands of borrowers further into stress.
“Many households are already cutting back on spending just to keep up with their home loans — it’s a silent strain on families.
“With the cost of living continuing to rise, higher loan repayments only add to the pressure.
“Now is the time to explore your mortgage options before stress turns into a crisis. If you haven’t refinanced or asked your lender for a better deal, there’s a good chance you’re paying too much.
“Even shaving half a percentage point off your home loan can save you thousands of dollars.”
Meanwhile, Whitten said Australians with several mortgages will not be able to pass down the rate hike to their tenants so easily.
“Landlords will try to pass the cost of interest rate rises onto their tenants where they can, but it’s not always that simple.
Market factors like supply and demand in a location, plus the characteristics of the property itself play a big role in determining what an investor can realistically charge. Another constraint is the amount tenants are willing to put up with in terms of increases.
And we don’t see landlords lowering rents when interest rates go down. It’s just one part of the picture.
A good investor knows that interest rate rises are a risk of investing and plans accordingly,” he said.
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