Brighter And some

What’s the magic number to avoid mortgage stress?

by Kate Watt, Marketing Manager 12 December 2024

It’s commonly said that mortgage repayments should be no more than 30 per cent of your household income if you want to avoid mortgage stress.

But as property price growth has outpaced wages growth, many Aussies are digging deeper to pay off the home loan.

A Real Estate Institute of Australia analysis found that Australians are now typically spending 48 per cent of their household income on their mortgage repayments, reports Australian Property Investor.

In dollar terms, Queenslanders are paying the third highest home loan costs in Australia, with typical monthly repayments of $3,727 based on an average home loan of $604,988.

So does this equate to mortgage stress?

For some yes, for others no. It depends on your other costs and your income.

Heading into the Christmas period is a great time to get a handle on your budget so you can start the new year without a debt hangover and ready to achieve your financial goals.

A financial planner or accountant can help but there are some simple steps you can take yourself to get a handle on your spending. Check out free budgeting apps or tools your bank might offer to help you stay on top of your cash.

If you want to benchmark your spending, the Australian Bureau of Statistics reports the following average monthly costs for Aussies, says Australian Property Investor.

  • Groceries: $600 to $1000 per month
  • Entertainment and leisure: $200 to $500 per month
  • Utilities (electricity, gas, water): $300 to $500 per month
  • Transport (petrol, public transport): $400 to $800 per month

Making new year property plans? View our current listings for sale or contact us for a chat about anything real estate.