Aussie borrowers are cutting takeaway, subscriptions, holidays and nights out as mortgage repayments and cost-of-living pressure force households to hunt for savings.
Australians are ditching takeaway, subscriptions, coffees and nights out as the mortgage squeeze forces households to find extra cash for repayments.
The latest Mortgage Choice Home Loan Report shows two in three borrowers have cut spending to manage home loan repayments, while four in five prospective buyers have made sacrifices to save for a deposit.
Only 32 per cent of borrowers knew their current interest rate, down from 40 per cent a year earlier, despite the national average loan size rising almost 11 per cent, up $67,759 year on year to $696,443.
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Mortgage Choice chief executive Anthony Waldron said consecutive rate hikes this year had shaken buyer confidence, with 50 per cent of prospective buyers saying interest rates were making them feel less confident to buy, up from 35 per cent in the previous quarter.
“With each new hike, buyers are having to reassess their property plans, and find new approaches to saving and planning,” Mr Waldron said.
The report found prospective buyers were eating out less, cutting non-essential purchases, cancelling entertainment expenses, delaying holidays, cutting back on groceries or household essentials and driving less to save on fuel.
Mortgage Choice chief executive Anthony Waldron said rate hikes had shaken buyer confidence, with half of prospective buyers now less confident about purchasing a home. Picture: Supplied
Mr Waldron said sacrifices were now rising among borrowers and hopeful buyers, while 45 per cent of first-home buyers expected financial support from their parents to buy property.
Refinance submissions were up 18.7 per cent year on year over the March quarter, with borrowers in Victoria and Tasmania the most active refinancers.
Stamp duty was also the top housing issue Australians wanted addressed in the federal budget.
Mortgage broker Steph Jordan said many borrowers still had room to trim spending on subscriptions, Uber Eats, coffees and other lifestyle expenses before cutting essentials. Picture: Supplied
Zara Lend director Stephanie Jordan said most borrowers were still finding ways to manage, but many had room to trim their budgets before cutting essentials.
“When I look at people’s living expenses, I feel like there is still a lot of room to trim,” Ms Jordan said.
“There is a lot of leisure spending, subscriptions and things like that that people could reduce to absorb some of these rate increases.”
Ms Jordan said younger borrowers were often spending on Uber, Uber Eats, subscriptions and entertainment, while older borrowers were reviewing larger household bills such as health insurance.
Borrowers are reworking household budgets as the mortgage squeeze bites, with two in three cutting spending to manage home loan repayments. Picture: NewsWire/ David Crosling
“I am more seeing them cut back on things like coffee and takeaway,” she said.
“I do not think they are really cutting essentials at this point.”
Ms Jordan said some refinance clients were paying rates in the sevens or mid-sevens when they could be paying a percentage point or more less.
She said family support was increasingly becoming the difference between buying and missing out for some first-home buyers.
“If they have their eye on a property that is just out of reach, parents often seem willing to chip in a little bit to help them get the property,” she said.
Mortgage broker Rhys Elmi said “survival mode” was probably too strong, but many borrowers were finding ways through rising home loan costs.
Mortgage Choice Cheltenham broker Rhys Elmi said “survival mode” was probably too strong a term for what he was seeing.
“But from what I’m seeing on the ground, I’m not really seeing clients in severe mortgage distress,” Mr Elmi said.
“If people have had rising costs attached to their property or their home loan, they have generally found a way to manage it.”
Mr Elmi said it did not surprise him that many borrowers did not know their current interest rate, because rates had moved around significantly over the past year.
Borrowers who have not reviewed their home loan rate could be paying more than they need, with only 32 per cent knowing their current rate. Picture: NewsWire / Gaye Gerard
“It is one of those things a lot of people tend to let run in the background,” he said.
“It is not something most people are checking every month.”
Mr Elmi said he was seeing a rise in family gifts being used to help buyers enter the market.
“I am definitely seeing a big rise in gifted funds,” he said.
“I wouldn’t necessarily say every first-home buyer expects it, but we are seeing a lot more situations where family members are willing to kick in cash to help someone get into the market.”
Mortgage broker Damien Medici said borrowers were under more pressure as fuel and other inflationary costs added weight to home loan repayments.
Margin Finance director and broker Damian Medici said borrowers were under “a little bit more mortgage stress” because fuel and other cost pressures were adding weight to repayments.
“From rates alone, we have been here before,” Mr Medici said.
“But it is all the other inflationary pressures that are probably adding a little bit more weight again.”
Mr Medici said borrowers were mostly cutting discretionary spending first.
“The biggest thing is discretionary spending,” he said.
Takeaway, coffees, subscriptions, holidays and entertainment are among the first lifestyle costs being cut as Australians try to keep mortgage repayments under control. Picture: NewsWire/ David Crosling
“So it is eating out, luxury items, coffees, takeaway, clothing and things where people can stop and think, ‘Do I really need this?’”
Mr Medici said borrowers were not taking on larger loans by choice.
“Borrowers never borrow more because they want to,” he said.
“It is because they have to, to get in.”
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This article was originally published on 11 May 2026 at 5:00am but has been regularly updated to keep the information current.
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