The majority of Australians are worried the RBA will hike the official cash rate by 50 basis points before the end of the year, a new survey has found.
According to a recent survey of 1,000 Australians, compiled by non-bank lender BEAT Home Loans, rising rates are crippling home owners, with 40 per cent of respondent revealing they have cut the cost of their grocery bill in order to meet the mortgage repayments.
The survey found it is first home buyers that are being hurt the most by rising rates.
Nearly 50 per cent of the 25-34 year old home owners are paying over 40 per cent of their monthly household income on their mortgages, compared with 28 per cent of 35-44 year olds and 19 per cent of 45-54 year olds.
“Interest rates have been set at extremely low levels for the last couple of years, so those borrowers who have entered the mortgage market during that period have only been used to those very low rates,” BEAT general manager Kelly Humphreys said.
“If interest rates continue to rise it is this group of borrowers that are likely to feel the strain first.”