How rate hikes are hitting every suburb in Victoria: PropTrack

Homebuyers are being priced out of Melbourne and even their home dream after another rate hike. See what the impact has been for homes in your suburb.

9 Minstrel Close, Wyndham Vale, sold this week and the buyers are facing a $2800 mortgage that’s hundreds of dollars more than they would have paid a year ago.

Homebuyers are being priced out of Melbourne and even their home dream after a 12th rate hike in 14 months smashes their budgets alongside owners’ wallets.

New figures show the cost of paying a mortgage will now be $1000 a month higher for a typical house in more than 380 Victorian suburbs than it was at the start of 2022.

It comes as the nation’s top real estate advisory group this week warned Australian housing affordability had slipped to its worst level this century as rate hikes smash home budgets.

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A house bought at Melbourne’s $900,000 median price now takes an extra $950 a month to pay off than it did in April last year, rising about $2.40 a day since the Reserve Bank began hiking rates.

The hikes have also knocked about $200,000 off the budget for most buyers.

PropTrack analysis of loan costs contrasted with median house prices across the state before the rate hikes and today to reveal the shock statistics.

They assumed a standard 80 per cent loan, a 30-year term and reviewed 515 towns and suburbs across Victoria.

In Melton, the city’s most affordable suburb, where the typical house costs $470,000, buyers will pay an extra $700 a month more than in early 2022.

PropTrack economist Angus Moore said the rapid fire increases were already having impacts on the economy and housing market.

“Two key impacts are that borrowing power has decreased significantly, and the number of first-home buyers has dropped dramatically,” Mr Moore said.

He warned about half of the nation’s borrowers would come off ultra-low fixed rates this year.

Australian Banking Association chief executive Anna Bligh said the nation’s lenders were maintaining high staff levels in their hardship teams in anticipation of further mortgage pain and encouraged those suffering to get in touch.

40 Rubicon St, Dallas, recently sold for $610,000 and could leave the buyers paying $2900 a month to cover the mortgage.

43 Lorimer St recently sold for $435,000 in Melton, Melbourne’s most affordable suburb — but the monthly mortgage payment is still likely to top $2000.

“The banks are more likely to help you the sooner you talk to them,” Ms Bligh said.

“When it gets really complicated is when people start using their credit card to pay their mortgage.”

In most instances banks will be able to provide a range of options to loan holders including changing the term of the mortgage or deferring payments for a while.

Mortgage Choice broker David Thurmond said in Melbourne’s outer south east, rate hikes were forcing some buyers out of the metropolitan area and others out of the market.

“Most clients are now expecting to purchase for $200,000 more than their borrowing capacity will allow,” Mr Thurmond said.

“In my area, that could mean they are out of the ball game.”

15 Patterson Court, Brookfield, earned its last owners $545,000 recently. The new ones might be paying about $2590 to the bank each month.

1411 Pascoe Vale Rd, Meadow Heights, sold for $656,000, leaving the buyers facing a monthly mortgage payment of $3100

For those who want to buy, he said finding the right lender could save the equivalent of a 0.25 per cent interest rate hike on their loan.

Earlier this week the Real Estate Institute of Australia reported housing affordability in Victoria had reached its worst level since they began tracking a combination of repayment costs, home prices and other factors at the turn of the century.

REIA president Hayden Groves warned the RBA was “lurching us inevitably into recession” if they did not pause soon.

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