Monthly mortgage payments will likely rise again for many Australians as the Reserve Bank's rise in interest rates continues to hurt the industry. Even worse is that there is a definite rental shortage in Sydney leaving many who can no longer afford to make mortgage payments without many options.
National Australia Bank and Westpac – two of the larger lenders and mortgage banks – passed on the increase in interest rates by the Reserve Bank to homeowners and landlords. Westpac moved its rate up 0.3% to 9.27%. Additional banks including ANZ, St George and Commonwealth Bank are also likely to see similar rate increases.
On average, this increase will increase repayments on a A $300,000 mortgage by A $60 a month.
Sydney's vacancy has dropped to 0.9%, which makes it more difficult than ever for people to find affordable housing.
According to Bloomberg News, Adam Carr who is the senior economist at UBS AG located in Sydney had this to say about the impact of the rate rises on the housing market.
"This is a woeful number. Housing is clearly weakening, there is no doubt about it. The risks are that the interest rate rises are leaning too heavily on the housing market."
