Scary ABS data shows Aussies are taking on $724k average home loans as weaker buyers vanish from the mortgage market.
Australians are taking on “scary” monster mortgages of more than $724,000 as soaring property prices push weaker borrowers out of the market.
New Australian Bureau of Statistics data shows the average home loan size climbed to $724,415 in the March quarter, up 9 per cent in a year.
But the number of new home loans fell 6.2 per cent to 139,794 over the same period, showing fewer Australians are getting into the market even as those still buying take on larger debts.
RELATED: Geelong’s ‘Hogwarts’ orphanage hits the market‘
Bulls**t’: TV star’s meltdown over nothing
Melb’s $1bn secret hub beating CBD slump
Mortgage Choice Greenvale broker Rebecca Stella said the figures showed housing affordability had become brutal for ordinary buyers.
“It is very unaffordable out there,” Ms Stella said.
“People just can’t afford to buy, or they could be holding off because they think the market may drop.
“But I don’t think that’s going to happen. I think it will stabilise.”
Mortgage Choice broker Rebecca Stella says the size of the average Aussie home loan is now “scary”.
Ms Stella said the size of the average home loan was now “scary”, particularly as households battled rising groceries, petrol and mortgage repayments.
“The cost of living is through the roof and they’ve got higher mortgage repayments,” she said.
“You would need two incomes coming into a home now, which is really sad.
“Those days are almost gone.”
She said real estate agents she dealt with had reported fewer people attending auctions and open-house inspections, but those who remained active were still borrowing heavily because prices had continued to rise.
Brokers say the days of buying a home on one income are almost gone as monster mortgages hit Aussie households.
“There are fewer people at auctions and local real estate agents I deal with have said numbers have dropped off at open-house inspections,” Ms Stella said.
“But people do have bigger loans now, unfortunately, and that’s due to prices.”
She said more households would need to tighten their belts if repayments rose again.
“I think people will be feeling the pain,” Ms Stella said.
“The sad, unfortunate thing is people will need to cut back on their lifestyle now and tighten their belt.
“They might have to get rid of some subscriptions. Even $50 a month can go towards petrol or groceries.”
Australian Bureau of Statistics head of finance statistics Mish Tan says home lending fell after rate rises in February and March.
ABS head of financial statistics Mish Tan said the fall in loan numbers came after strong growth throughout 2025.
“Falls were recorded across all borrower types this quarter, following strong growth throughout 2025 and cash rate rises in February and March,” Dr Tan said.
“Despite this quarter’s fall, lending activity remains at high levels, with total new home loans 8.6 per cent higher than a year ago.”
The value of total new home loans also fell 3.8 per cent, or $4bn, to $103bn in the March quarter, but remained 18.5 per cent higher than a year earlier.
Dr Tan said the value of new lending had continued to grow faster than the number of loans, a trend recorded since the December quarter of 2023.
The average Aussie home loan has surged to $724,415 as buyers stretch further to get into the property market.
“The average home loan size is now 9.0 per cent higher than a year ago at $724,415,” Dr Tan said.
“This is consistent with rising property prices, with the strongest growth in Western Australia, Queensland and South Australia.”
The data also showed first-home buyer owner-occupier loans fell 4.3 per cent in the March quarter, after a 6.5 per cent rise in the previous quarter.
The value of first-home buyer loans dropped 6.7 per cent to $17.9bn, though it was still 17.9 per cent higher than a year earlier.
The average first-home buyer loan rose 1.1 per cent to $614,048 in the March quarter, after an 8.5 per cent jump in the previous quarter when the Australian government’s 5 per cent Deposit Scheme was expanded.
Finance broker Tom Mifsud says weaker borrowers are being pushed out while stronger buyers take on monster mortgages.
Alba director Thomas Mifsud said weaker borrowers were being pushed out while stronger buyers continued to take on large debts.
Asked if weaker borrowers were being forced out while buyers still standing took on monster mortgages Mr Misfud said “Bluntly, yes.”
But he said the divide was more complex than family wealth alone.
“It certainly gives you an advantage when you have assets and wealth,” he said.
“But we have a fundamental issue across lower-end borrowers and higher-end borrowers about financial literacy.”
Mr Misfud said borrowers who remained active were increasingly leaning on brokers and advisers to understand how much debt they could safely carry.
“Rates going up still hurts the back pocket,” he said.
“But it is different when it has been explained to you.”
Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.
‘Inevitable’: Grim housing crisis warning for Victorians
david.bonaddio@news.com.au
English (US) · 