Borrowers who are not making repayments appear to be staying in their homes for longer than in past economic cycles, as banks seek to minimise the scrutiny that comes with calling in their loans, says Stewart Oldfield, director of Field Research.

In the biggest markets of NSW and Victoria, mortgage arrears are stable. For example, in NSW, the number of borrowers more than 30 days late on repayments was 0.96 per cent in December from 0.94 per cent in July 2023 and 1.01 per cent in November.

But in WA, more borrowers are behind, with 1.19 per cent more than a month overdue – although this improved from 1.50 per cent in July last year. The best performing state is Tasmania, at 0.48 per cent.

CBA said this month that official rate rises are being unevenly felt, as savings are depleted faster for younger borrowers. Customers aged between 25 and 34 saw year-on-year savings down 2.4 per cent, CBA said, while for the 35 to 44 band, savings were 2.1 per cent lower. They rose for over 65s by 6.5 per cent.

Roy Morgan said the number of mortgage holders considered “at risk” of mortgage stress had surged to a record on the back of the Cup Day rate rise in November. The 1.6 million at risk – defined as borrowers who allocate between 25 per cent and 45 per cent of their after-tax income to repayments – has increased by 802,000 since May 2022, when the RBA began tightening.

If the central bank raises rates by a further 0.25 percentage points in March, this will push a further 16,000 borrowers into the risky category, the group estimates.

The number of mortgage holders considered “extremely” at risk – allocating more than 45 per cent of their income – is now almost 1 million, or 19.8 per cent of borrowers, exceeding the long-term average over the last decade of 14.3 per cent.

National Australia Bank said last week its quarterly cash earnings dived 16.9 per cent amid an economic slowdown, reflected in rising mortgage arrears and a $193 million impairment charge.