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A new survey shows almost seven in 10 renters worry about asking for repairs in case they face a rent increase, reflecting the shifting power dynamic between landlords and tenants in Australia.
Australia’s rental market typically favours landlords, leaving many tenants fearful of asserting their rights amid rising rents and limited housing options.
A new survey released this week by the Australian Council of Social Service (ACOSS) and other groups found 68% of renters expressed concerns about requesting repairs that may result in paying higher rent.
The study, which surveyed 1,019 people who rent in the private sector across Australia, found half of the renters surveyed lived in homes that needed repairs, with one in 10 needing urgent repairs.
ACOSS chief executive Dr Cassandra Goldie said there were serious failings in Australia’s housing market.
“It is completely unacceptable that people in the private rental market are nervous about asking for essential repairs because they fear a rent increase or eviction notice,” Dr Goldie said.
“Everyone deserves to be able to live in secure homes without the constant fear of losing their home.”
It’s been a tough time for renters in Australia, who have seen rental options dwindle in recent years and competition for available homes rise.
This has driven many renters to settle for properties that maybe don’t quite fit the bill, and when renters finally do find the property they’re looking for, they may not want to fully exercise their rights in fear of a rent rise.
But it’s important for renters to understand what protections are in place for them, depending on where they live.
Tenants’ rights are different across the states and territories, but there are some shared values which are the same across the country, such as a safe and healthy environment.
Tenants have the right to privacy, meaning no surprise inspections without notice, and renters have the right to end a tenancy early, however you may need to pay a break lease fee.
While renters are encouraged to stand up for their rights, all of this comes against a backdrop of ever-increasing rental costs that many renters have been struggling to keep up with.
The ACOSS study found a third of renters would be unable to afford their rent if it went up by 5%.
Yet rents continue to rise nationally, with the latest data showing Australia’s median rent grew by 5% to $630 per week during the March 2025 quarter compared with the same time last year, according to PropTrack.
REA Group senior economist Anne Flaherty said Australia’s rental market had been very challenging for tenants in recent years.
“The power dynamic has shifted towards the landlord, particularly over the past five years,” she said.
“However, it isn’t the same case in every suburb, and I think that tenants and landlords alike need to look at the situation in their own local market.
“There are suburbs around Australia where we’ve seen rents rise very significantly, but similarly there are suburbs that have seen significant declines in recent months too.”
Overall, Ms Flaherty said the rental market was challenged for renters, but there were some positive signs such as a significant number of suburbs where rents were decreasing and a growing number of investors returning to the market to provide additional rental housing supply.
The survey was published by the ACOSS/UNSW Sydney-led Poverty and Inequality Partnership, National Shelter and the National Association of Renter Organisations (NARO).
The post Power shift: Renters afraid to speak up as landlords hold the cards appeared first on realestate.com.au.
A UK home has been blasted on social media for having the most dog muck one TikTok star has ever seen.
The Housing Horrors account – which has 166,000 followers – recently highlighted the £130,000 (AU$273,000) terraced bungalow in Sutherland Street, Seaham, after he was left stunned by the property’s listing images.
While the home seemed innocent enough from the outside – and even the inside – the backyard was something different all together.
Here, the listing agent showed a courtyard garden covered in dozens of piles of dog poo, as well as a small dog.
While the listing images were quickly removed online, piles of poo are still visible via the kitchen window which overlooks the rear garden.
“What the bloody hell are they thinking?,” the man behind Housing Horrors states.
“I don’t know what is worse – the owners leaving all of this dog poo out there like this, or the agent thinking it’s a great idea to upload this photo.
“This is going to put off any prospective buyers. Imagine looking through a house… buying your first house and seeing that.
“I’ve never seen so much dog poo in my entire life!”
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The Seaham home’s backyard is covered in poo, according to listing images.
The poo covered yard can even be seen fro the kitchen window.
The front of the home look relatively tidy.
The influencer goes on to claim: “This is genuinely one of the worst properties I have ever seen in my life”, before looking through other pictures of the property.
The video, which has amassed over 1.1m views on TikTok, has attracted plenty of outrage from viewers.
“If I don’t clean up after my dog for 3 days my garden stinks, I can’t imagine this!,” one follower commented.
Another said: “I’m worried about the dog somebody call RSPCA”.
A third commented: Here’s me having a panic attack because In my estate agent photos my tea towel wasn’t folded correctly on my oven handle ! that poor baby dog though living in that breaks my heart.”
The post Poo piles galore: TikTok star uncovers backyard horror appeared first on realestate.com.au.
Despite major surges in prices since the pandemic, Queensland continues to draw strong demand from buyers, including Springfield in Greater Brisbane region. Picture: AAP Image/Dan Peled
A Big Four bank executive reveals the hottest housing markets that buyers are flocking to as the country prepares for imminent back-to-back interest rate cuts.
Denton Pugh, who is the National Australia Bank executive for home lending, explains below where the momentum is currently building and which housing markets are seeing strong growth nationally from a borrowing perspective.
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NAB Executive for Home Lending Denton Pugh
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We might be deep into the winter months, but there’s definite signs of warmth returning to Australia’s property market.
Home values across the country have nudged higher again, rising 0.5 per cent in May and lifting the national index 1.7pc over the first five months of the year. And every capital city recorded growth. A sign that confidence in the market is continuing to grow.
We’re seeing this confidence play out in people like Emily Chalk, a 32-year-old first-home buyer who recently bought a home just outside of Rockhampton, in regional Queensland.
She’d spent six months looking for a place to call home.
A conversation with her banker helped her understand how the Government’s Home Guarantee Scheme could help get her into her first home sooner than she thought. Within weeks she’d bought a home in the town she grew up in.
Geelong is seeing strong buyer growth in terms of loan applications including places like Armstrong Creek which is the area’s biggest housing market.
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Stories like Emily’s are becoming increasingly more common.
It’s not just upgraders or investors sitting on equity returning to the market. Many first-home buyers have been waiting for banks to reduce home lending rates so they can not only borrow more but also have that confidence to take the leap into homeownership.
New NAB home lending data shows lending to first home buyers is up 16pc since February, and up 32pc to home buyers more broadly.
While interest rates are still relatively high, recent rate cuts are helping. These cuts combined with initiatives like the Home Guarantee Scheme, we’re starting to see more people take that first step into homeownership.
Of course, we can’t ignore the bigger picture. While monthly growth is returning, the annual pace of property price increases has slowed. Not great news for investors but good news for those trying to break into the market.
We’re also seeing strong momentum in regional markets; a trend that’s been building since the pandemic years and is not going away.
An aerial view of a housing estate in Toowoomba which is the hottest regional housing market according to NAB. Picture: Toowoomba Regional Council.
10 hottest regional markets so far in 2025:
1. Toowoomba – QLD
2. Burnett – QLD
3. Springfield – Redbank – QLD
4. Geelong – VIC
5. Sunshine Coast Hinterland – QLD
6. Mandurah – WA
7. Loganlea – QLD
8. Ballarat – VIC
9. Maryborough – QLD
10 Mackay – QLD
In fact, Queensland regional hotspots dominated our list of the five hottest regional markets so far in 2025. Toowoomba, Burnett, Springfield-Redbank, and the Sunshine Coast Hinterland all ranked high for home loan activity. Geelong in Victoria was the only non-Queensland regional hotspot to break into the top five.
It may be the weather, or the lifestyle, but regional markets offer more than just charm and appealing work life balance. They offer affordability and the potential for long-term growth. For buyers like Emily, the appeal of staying close to family, and finding space for a young family was strong.
Ballarat is also in the national top 10. Picture: Chris Groenhout
“I already know most of my neighbours, I definitely didn’t have that when I was living in Brisbane,” first-home buyer, Emily Chalk.
This continued momentum is promising, but it also highlights one of the biggest challenges still facing the market – we need more homes.
Lower rates are helping on the demand side, but affordability and supply remain big hurdles.
Addressing those issues will take time, commitment, and smart policy. Particularly when it comes to getting new housing built in the places people want to live.
The winter months are usually quieter for the housing market, however, with most economists expecting further interest rate cuts this year, winter activity is expected to be a little higher than usual, continuing to build for the busier spring period.
The post Big bank exec reveals Aus hottest housing markets appeared first on realestate.com.au.
In the search for the perfect home, WA buyers from all walks of life, are looking for a place that looks and feels just right.
For many Australians, the ideal property strikes a balance between style and practicality, with a twist of modern elegance – so starting with the right design is key.
One Western Australian builder, Plunkett Homes, has perfected this mix with its ‘Windsor’ design—a two-storey Federation-style design drawing inspiration from classic British Georgian architecture.
With its red-brick highlights, gabled roofs, and timeless facade it’s a home that stands out for its beauty.
But its interior versatility makes it adaptable for all buyers, and its compact footprint has Perth buyers, from couples to growing families, all keen to take a look.
“In a style that is both classic and timeless, our Federation homes capture the iconic federation look and combines it with a modern layout to suit the many lifestyles of today,” shares Aaron Bennett, Plunkett Sales Manager.
Space to enjoy
Adequate space is essential for a home, but that doesn’t mean you have to own a vast plot of land.
Bennett explains that the ‘Windsor’ design has been carefully planned for tighter modern city blocks, not just expansive greenfield developments.
“It feels bigger than it is,” he says.
“Plunkett Homes have traditionally built in Perth’s inner suburbs, so the size suits subdivided blocks.”
The first floor features an open-plan kitchen and family area created with easy living in mind.
“The kitchen is elegant, with detailed cabinetry and quality appliances,” Bennett notes.
“A generous scullery and walk-in pantry are tucked behind the kitchen for additional storage.
“The kitchen and scullery loop around the alfresco, allowing seamless indoor-outdoor flow, ideal for entertaining.”
Bennett notes that premium appliances level up the kitchen and that the central hub design allows you to cook and clean while keeping an eye on the kids or chatting with guests at dinner parties in the main living area.
Meanwhile, the bedrooms and a home theatre upstairs provide a private retreat or even kid-friendly areas or a quieter place for teens to game or study.
Storage and functionality have also been front of mind according to Bennett.
The laundry features pull-out drawers and bench space for folding washing.
Bennett points to the spacious area under the federation-style staircase, saying it’s perfect for storage, or a wine cellar if you want to “add a touch of class”.
Effortless luxury
Regardless of your lifestyle choices, everybody desires luxury, so the ‘Windsor’ embraces elegance at every turn.
Inspired by older estate-style homes it features a sumptuous main bedroom suite and walk-through robe creating a private sanctuary instead of just an average bedroom.
Stef Yujnovich from Plunkett Homes adds that similar thoughtful elements have been sprinkled throughout the design to boost the elegance factor.
“The staircase needed to be luxurious, which was challenging beside a wall,” she says.
“But we added beautiful timber flooring and an open balustrade.
“The entry hallway is spacious, filled with ambient light, and features arches that set the tone for the home.
“The classic colour palette, with white tones and navy accents powerfully complements the design,” she adds.
“We have utilised a lot of white tones and introduced navy to pay homage to the federation style of the home.
“Some bold patterns have been utilised in the laundry, bathroom and powder to invite a sense of fun whilst keeping the palette classy and flowing throughout the home.”
Yujnovich says that the home will “appeal to the wider audience” given its blend of practicality and beauty.
“Even a professional couple would suit this home which is a very generous size without being so large that it discounts smaller families and couples.”
She adds that the upstairs bedrooms can also be easily utilised for flexible spaces, for couples, offering the options of an office, gym, or hobby space.
Quality in design is quality living
No matter how your household is comprised, quality should always be a priority, Bennet highlights, and it should definitely be on buyers’ minds when choosing a design.
“We’ve been at the forefront of the WA home building industry for more than 120 years.”
“We take great pride in the craftsmanship of each home,” he adds.
However, don’t just take his word for it, Bennett is encouraging buyers to visit the ‘Windsor’ Display Home themselves to see the quality up close, opening from mid-June at 90 Grindleford Drive, Balcatta.
“Over the years, we’ve innovated and adapted to create homes that truly inspire us, focusing on designing residences that stand the test of time and make the dream of home ownership a reality.”
The display home will be open Wednesdays from 2 to 5 PM, and on Saturdays and Sundays from 12 to 5 PM.
The post Where heritage meets flexibility: A home blueprint for balanced living appeared first on realestate.com.au.
President Trump has started Operation Shadow Fed President, with news breaking Wednesday night that he has identified several candidates for the next Federal Reserve chairman. Under this strategy, the president selects a new Federal Reserve chair well before they can officially assume the role and they communicate new Fed policy to the markets, which undermines the current Fed chair.
According to the Wall Street Journal, the people being considered include former Fed Governor Kevin Warsh, National Economic Council Director Kevin Hassett, current Fed Governor Chris Waller, former World Bank Group President David Malpass and even Treasury Secretary Scott Bessent.
What does this mean for the future of mortgage rates? Let’s consider some scenarios.
The shadow Fed president goes on a media blitz campaign
The main objective of the shadow Fed president is for Trump’s appointee to communicate to the market that significant changes will occur as soon as they assume the role of Federal Reserve Chair. This strategy undermines the influence of the current Fed Chair, Jerome Powell, who is expected to depart next year after his term is up.
Trump hopes that a dovish forward guidance will lead bond traders to lower the 10-year yield if these changes take place gradually. This doesn’t mean the 10-year yield is going to head toward 3.50% anytime soon, but it does prompt bond traders to start preparing for a more dovish Fed. I wrote about this potential strategy in April as Trump got more and more frustrated with Powell, yet is unable to fire him.
Labor data weakness will fuel dovish Fed language
A shadow Fed president will present a stronger backdrop for bond yields to go lower with weaker economic and labor data. Powell’s mindset of “let’s wait for labor conditions to deteriorate before taking action” will be fading soon, as the shadow Fed president will use the weakness in labor data to get even more dovish.
Powell has acknowledged that the Fed was late to start cutting rates in 2024 and has said the labor market is currently challenging for job seekers. With a new shadow Fed president in place, increased weakness in labor data could signal a green light for bond traders to buy more bonds, which would send mortgage rates lower. On Wednesday, the Fed also announced its proposal to ease regulations on financial institutions to allow them to hold more treasuries on their books. Treasury Secretary Bessent believes this can lower bond yields, which in turn will lower mortgage rates.
Now, the markets have never considered Fed policy to be accommodative under Powell since he started the massive rate hike cycle in 2022. Since the Fed began its rate cut cycle, all the markets have focused on is what a neutral policy looks like and how long it will take to achieve it. Under a new shadow Fed president, the person might signal to bond traders to become more aggressive if the labor data is breaking, thus causing the 10-year yield to drop below what any of us would imagine under Powell’s leadership.
Wall Street starts to forecast much lower rates
In an unusual announcement, Morgan Stanley on Wednesday morning stated that they expect the Fed to deliver seven rate cuts in 2026, starting in March, which would bring the terminal rate to 2.5% to 2.75%. Now, at first glance, that sounds like a very bearish economic take on the economy to have so many rate cuts in the forecast.
Then I realized, what if Morgan Stanley recognized that the shadow Fed president was about to happen? With the Fed taking a more dovish stance, the rate cuts, which would take us down to 2.5%-2.75 %, don’t seem crazy at all. I mean, before Powell got super hawkish, he even said himself on TV that the Fed would like Fed policy to mirror 3-, 6-, and 12-month PCE inflation, which would mean 2.5%-2.75% Fed policy today.
Maybe housing gets some love?
The Fed hasn’t shown any interest in boosting housing demand, even though housing permits and starts have been in a recession for some time now. One possibility for the new shadow Fed is to discuss reviving the housing market. This would be a significant shift, as the Fed has largely ignored the weakness in housing for years, and this new policy would make many American consumers happy. This would be a win for Trump and his administration while also putting the country in a better mood.
Conclusion
We are in the early stages of Operation Shadow Fed President but these scenarios make sense to me. I’ll be doing an even deeper dive on the topic in the next episode of the HousingWire Daily podcast. I want to emphasize that labor data remains the key driver of mortgage rates and Federal Reserve policy. If the economy weakens over the next six months, the Fed will likely take action, even without a shadow Fed president in place. However, with this new variable in the equation, we can begin to approach things in a different way.
Rocket Close and Rocket Pro have taken a major step forward by integrating the two platforms into a single, more efficient platform, designed to simplify the closing process and enhance the broker experience. Under the leadership of Matt Brown — Rocket’s Executive Vice President, Sales and Revenue Strategy, with a background in tech, finance, and business growth — the company is focused on simplifying the closing process while empowering brokers with smarter, more connected tools. This strategic evolution isn’t just about combining systems; it’s about delivering a faster, cleaner, and more intuitive experience from start to finish, setting a new standard for the future of digital closings.
HousingWire: Rocket Close has recently undergone a bit of a change. How would you describe the journey that led from Amrock to Rocket Close, and what prompted the decision to make this change?
Matt Brown: It’s been a deliberate and strategic journey. We didn’t just wake up one day and decide to change the name. After carefully examining our existing systems and processes, we realized we had already built an end-to-end experience that wasn’t fully reflected in our previous branding. We listened intently to our partners and recognized that brokers were being asked to navigate too many disconnected systems and vendors.
By becoming Rocket Close, we’re making our comprehensive, integrated approach crystal clear. Now, everything is aligned under one brand, one vision, and one platform. It helps brokers move faster, serve their clients better, and feel more confident throughout the process. So yes, the name changed—but really, it’s the experience that leveled up. We’re clearer, more connected, and better positioned to help brokers win. Title and closing need to stop being an afterthought, because we’re offering a true, market-differentiating asset.
HW: The integration of Rocket Close with Rocket Pro is geared towards simplifying the loan process for broker partners and their clients. Can you share how this approach makes things more efficient and what specific pain points this solves for brokers?
MB: One of the biggest challenges brokers face is the need for more time. Everything is on a deadline, and when a title partner isn’t in sync with the rest of the process, that creates stress, delays, and confusion. We built Rocket Close to be the exact opposite of that.
Because we’re fully integrated with Rocket Pro, brokers can order a title with one click. No logging into another system. No re-entering information. Everything just flows. That saves time, removes guesswork, and gives brokers more control over the process.
We also provide real-time updates, so brokers aren’t left wondering what’s happening or when they’ll receive the next status update. It takes away that feeling of chasing down information and replaces it with confidence. And that matters, not just for closing deals, but for how brokers represent their clients.
We’ve also revolutionized the Closing Disclosure process. Traditionally, finalizing a Closing Disclosure could take hours or even days, involving multiple back-and-forth communications. With our integrated Rocket Close and Rocket Pro platform, we’ve automated over 90% of the CD collaboration*. Brokers can now see real-time updates, make instant adjustments, and finalize documents with unprecedented speed and accuracy. This means less time spent on paperwork and more time focusing on what matters most – serving clients and closing deals.
*Stated percentage is based on internal reporting
HW: Your eClosing process has racked up thousands of five-star reviews on Trustpilot. What elements of the Rocket Close experience are leading to this feedback, and how do you see this shaping the future of closings in the mortgage industry?
MB: The feedback we get is one of the best parts of the job. What people love about our eClosing experience is how smooth and stress-free it feels. Most clients don’t expect the closing to be the easy part. But when you can wrap things up in as little as 20 minutes, from your living room, on your schedule—it changes the game.
But it’s not just about convenience. It’s about trust. We prioritize eClosing for our broker partners because we know it helps them deliver an exceptional experience. While we do work with other lenders, availability outside of Rocket Pro is limited to ensure our partners remain the priority.
Our shared goal is accomplished in spades. Our mutual clients walk away thinking, “Wow, that was fast, professional, and actually kind of enjoyable.” And that sticks. It really helps brokers stand out and build stronger relationships because their decision to work with us made the difference.
We see eClosing as the future because it’s where digital meets personal. It’s efficient, but it still feels human. That’s the sweet spot we’re aiming for across the board*.
*eClose availability is based on loan type as well as state and county eligibility.
HW: Looking ahead, Rocket Close is set to roll out new correspondent features in collaboration with Rocket Pro later this year. What opportunities do these updates create for brokers, and how will they impact the overall mortgage process?
MB: This is something we’re actively working on and genuinely excited about. Correspondent lending is a complex space, and brokers working in this area need tools that provide flexibility without compromising visibility. That’s exactly what these updates will do.
By integrating more correspondent capabilities into the Rocket Pro portal, we’re working on providing brokers with a single platform to manage everything. They’ll be able to move deals through more quickly, stay more organized, and reduce the back-and-forth that often slows things down. More importantly, they’ll have the tools they need to customize their process based on how they run their business.
It’s about giving brokers more control while still backing them with the scale and reliability of Rocket Close. That combination creates a huge opportunity for growth.
HW: As you think about the future of Rocket Close and the broader mortgage ecosystem over the next five years, what key developments or innovations do you think will further enhance the broker and client experience?
MB: I think we’re going to see a real shift toward experiences that are not just faster, but smarter. Right now, speed matters. However, brokers want the ability to make better decisions more quickly. That means providing them with more data, greater transparency, and tools that help them identify issues before they become problems.
We’re investing in tech that can do just that. For example, imagine a broker being notified before a file encounters a delay, or seeing all the title progress in one view alongside their loan. That kind of visibility changes how they work. It saves time, sure—but more importantly, it builds trust and gives them peace of mind.
At the same time, I think we’ll continue to raise the bar on what “digital” really means. It must feel seamless and personal. Whether that’s through eClosings, smarter communication tools, or integrated platforms like Rocket Pro, the future will reward partners who make the process feel less like work and more like progress.
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While signs of a cooling housing market are beginning to emerge, with roughly 500,000 more home sellers than buyers now in play, according to a recent Redfin report, rising affordability barriers continue to sideline many would-be homeowners.
The median home price in the U.S. stood at $416,900 in the first quarter of 2025. With median household income at about $80,600, a buyer would need a 30-year mortgage interest rate closer to 4 percent to keep housing expenses at or below the 30 percent of income affordability threshold. Today’s rates continue to hover around 7 percent, making monthly costs unsustainable for many. When property taxes and insurance are factored in, the gap widens even further.
This affordability divide underscores a persistent reality: millions of those living in the U.S. simply can’t buy right now, even if more homes are available. Instead, they’re remaining in the rental market, but that too is becoming increasingly strained.
The national rent-to-income ratio has surged to nearly 47 percent, well above what is considered affordable, according to a recent Experian rental market report. For the 62 percent of renters who fall into the low- to moderate-income bracket, that share climbs to more than 55 percent, up sharply from prior years. At the same time, average renter income has declined slightly, heightening the pressure.
This strain is felt unevenly across the U.S. California, already the most housing cost-burdened state, saw month-over-month median rent rise 2.63 percent in May to $3,900, according to RentSpree data. In contrast, Texas, buoyed by a more robust housing supply, saw median rent fall 10 percent to $1,800, along with a 4 percent decline in maximum rent levels to $8,800, offering at least some localized relief.
In Florida, the story is more mixed. While the median rent fell 11 percent to $2,500 in May, RentSpree data shows the highest-end rentals rose nearly 6 percent, hitting $9,000, evidence that luxury demand remains strong.
Demographically, renters now span every generation, from Gen Z, who make up 34 percent of all renters according to the Experian data, to Baby Boomers, who are increasingly choosing to rent due to financial limitations or lifestyle flexibility. Research shows a 14 percent increase in renters aged 44 and older between 2023 and 2025, a notable shift that points to the long-term role of renting in the U.S. housing system.
Rental vacancy rates rising to 7.1 percent in Q1 2025, up from 6.6 percent in the first quarter of 2024 may signal some relief ahead. Some supply could stem from sellers unable to offload their homes in today’s market as potential buyers retreat due to high property prices and borrowing costs. Hence, some homeowners may opt to rent out their homes instead, especially in price-stagnant markets. This shift could boost rental inventory in select regions but is unlikely to move the needle significantly on affordability.
The bottom line is that renting is no longer just a temporary bridge to homeownership but a lasting reality for a significant growing portion of the U.S. population. But while it remains the key alternative to home ownership, renting is far from affordable. In many parts of the country, it comes with steep financial burdens. Regional differences only sharpen this divide.
Rent spikes in California, relative affordability in Texas, and sharply tiered markets like Florida all illustrate how location can either ease or intensify the strain. Despite a softening for-sale market, many renters remain priced out of ownership, cementing rental housing as a core, and increasingly permanent, pillar of the U.S. housing landscape.
Michael Lucarelli is the CEO of RentSpree.
This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.
To contact the editor responsible for this piece: zeb@hwmedia.com.
If you are having financial trouble you can ask your lender about hardship options.
You miss a mortgage repayment, what happens next? According to the experts, that largely depends on how quickly you spring into action.
Say you miss one payment but you quickly make good. Then you stay on top of your future repayments.
Finder home loans expert Richard Whitten says you may get hit with a late fee. If, on the other hand, you fail to make up that missed repayment, you could be at the top of a slippery slope.
“You’ll soon receive a default notice and your credit score will take a hit,” he says. “If you’re in this situation you’re likely in financial distress.
“In the worst case scenario your lender can start legal proceedings against you and ultimately reclaim your debt by forcing the sale of the property.”
Lenders can force the sale of your property if you can’t pay your mortgage.
Financial Rights Legal Centre director of Casework Alexandra Kelly says if you receive a formal default notice you should take it extremely seriously.
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“If you do not rectify the default in the period (generally a minimum of 31 days) they can accelerate your mortgage – which means it is no longer about the arrears, but the full amount due under your mortgage,” She says. “This can then result in formal repossession proceedings taking place through the relevant state court.
“If a property is vacant, they do not need a court order.”
Founder of Atelier Wealth Mortgage Brokers Aaron Christie-David. Picture: supplied
Mortgage broker and managing director of Atelier Wealth Aaron Christie-David says if you come into unforeseen circumstances, like a job loss or illness that will affect your ability to pay your mortgage, you should call your bank or broker to discuss hardship arrangements before you start missing repayments.
“You’ve got to put your hand up for help super, super early,” he says. “You need to ask for permission – you can’t ask for forgiveness.”
The Financial Rights Legal Centre has a Mortgage Stress handbook as well as sample letters on their website that show how to ask your lender for hardship arrangements. There’s also a free and confidential National Debt Helpline on 1800 007 007.
“Lenders are obliged to offer hardship arrangements to people in hardship, and this can help reflect your situation accurately in your credit history,” Kelly says.
Finder’s Richard Whitten.
INSURANCE COVER
If you can’t afford to repay your mortgage on an ongoing basis, you may be faced with the difficult decision to sell, but if it looks like you will still owe the bank a shortfall after the sale, there are some things to consider.
“A free financial counsellor can help you understand your financial position and give you some guidance on options available,” Kelly says. “Sometimes people hold insurance cover they can claim on during hardship – such as income protection or mortgage protection insurance. But, this is not always held or widely claimable – it will depend on the cause of your inability to pay.”
Lenders Mortgage Insurance will not protect you in the case of mortgage default. Instead, it protects the lender.
If you can’t pay your mortgage you may be forced with the difficult decision to sell.
“Any shortfall amount left owing (if the property is sold for less than the mortgage debt) will be owed by you as an unsecured personal debt – but to the insurer and not the lender,” Kelly says. “The insurer may make contact through a debt collector to demand repayment.”
Some LMI providers, like Helia, work alongside lenders to support borrowers experiencing hardship.
“Helia assesses waiving shortfall debt on a case-by-case basis and considers circumstances such as family violence and illness,” a company spokeswoman says. “In 2024, Helia supported over 11,000 families experiencing hardship support helping them remain in their homes and provided $4.6m in shortfall debt waivers for borrowers who sold their property.”
NEGATIVE EQUITY
It’s not common for Australian borrowers to wind up in negative equity, Whitten says.
September 2024 data from the RBA shows less than 1 per cent of all owner-occupier housing loan balances at the time were more than 90 days in arrears and that just 0.5 per cent of loans in arrears were estimated to be in negative equity.
It’s better to contact your bank about hardship arrangements before you start missing payments. Picture: istock
“RBA analysis in 2024 found that the borrowers most likely to be in mortgage arrears were high LVR borrowers (borrowers with smaller deposits relative to the amount they borrow),” Whitten says.
Whether there is a shortfall on a property at the time of sale can depend on several factors, including market fluctuations and the borrower’s ability to manage debt, Kelly says.
If you are trying to sell a property where you are receiving offers worth less than the amount you owe you need to ask your lender’s permission, she adds.
“They will look at factors to make sure the offer is reasonable. You should always seek permission before you enter into a contract of sale, as they will need to agree,” she says.
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