Australia mortgage stress surges to 450,000 households as default risks hit tipping point

Reserve Bank Governor Michele Bullock may have to announce another rate hike. Picture: Nikki Short Cost of living pressures and soaring interest rates have fuelled an explosion in mortgage stress levels over the past three months, with experts warning many Aussies will be forced to default on their loans. Exclusive household spending figures have revealed the number of households in stress – spending more than they were earning – swelled to 450,539 in the country’s top ranked postcodes over the third quarter of 2026. The Mortgage Stress Report Q3 2026, published by OurTop10 and powered by Digital Finance Analytics data, indicated a net rise of 31,318 new households slipped into negative monthly cash flow over the quarter. MORE: Salary you now need to afford home in each suburb Over the past 12 months, the number of financially strained households expanded by 79,072, representing a 21 per cent annual jump. Mortgage stress levels have been elevated as cost of living rises, with new property buyers having higher levels of stress. Financial pressure climbed across 61 of the 77 ranked postcodes nationwide, according to the data, which was based on nationwide rolling surveys of spending ...