For someone with a $1 million mortgage, repayments could soar by a total of $1083. Before Tuesday’s interest rate decision, the median economists’ forecast was for the official cash rate (OCR) to peak at around 2.5% mid next year. Rate hikes of this magnitude would engineer the biggest proportional rise in mortgage repayments in Australia’s history, adding to household’s cost of living pain. Borrowers in Sydney would be most impacted, with monthly mortgage repayments on the median priced home jumping by $1,163. Given Australian house prices soared around 35% over the pandemic on the back of deep cuts to mortgage rates, heavy price falls would necessarily ensue from the sharpest lift in mortgage repayments in the nation’s history.

Source: Stuff June 08, 2022 23:55 UTC