Sydneysiders hold the dubious honour of being Australia's mortgage moguls, with remaining debts 30 per cent higher than the national average.
The average Sydney mortgage now weighs in at $365,873 across all mortgage-holding households, including those who bought decades ago, according to analysis by the Grattan Institute.
The analysis shows the national average for all outstanding principal mortgages, excluding investment loans, now stands at $280,912, prompting fresh warnings authorities will have to impose speed limits on mortgage growth within the next six months.
The average outstanding Sydney mortgage is now valued at more than $365,000.Credit:Sam Mooy
The figures reveal it is younger Australians who shoulder the highest mortgage burdens, having had less time in which to pay them down. Nationally, households where the reference person is aged 35 to 44 shoulder the biggest mortgage debt of any age group, at an average of $353,087 a household.
But the figures also suggest some older households are taking significant mortgages into retirement, with the average mortgage of a household aged 65 to 74 sitting at $135,884.
However, the typical or "median" debt of these households is much lower at $46,187, suggesting a smaller number of households with large debts skewing the results.
The figures are drawn from the Australian Bureau of Statistics' latest survey of household income and wealth, and include all mortgages on principal residences – excluding investment debt.
The Grattan Institute's Brendan Coates said separate Reserve Bank data on mortgage credit confirmed the total mortgage debt owed by Australians had not changed since that last survey.
"New borrowers are taking out larger mortgages, but existing borrowers have been pocketing the savings from recent interest rate and tax cuts to pay down their mortgages," Mr Coates said.
Amid fears that borrowers are over-extending themselves, the analysis shows higher income households are shouldering most of the debt.
The average mortgage of a household earning in the top fifth of all households by income – an annual household income of $167,805 gets you into this club – stands at $374,153.
Mr Coates said the rapid growth in the size of new loans – up 16 per cent over the year – would worry the Reserve Bank and likely prompt regulator action to curb new lending.
"With interest rates set to remain at record lows and house prices rising rapidly, chances are we'll be talking about reinstating 'macro-prudential rules' – restrictions on how much banks could lend – again inside the next six months."
"Household debt to income remains very high, and that increases the kind of financial risks that prompted APRA to act last time around when they capped interest-only lending and lending to property investors, as well as rules governing how much buyers could borrow based on their incomes."
Separately, figures released last week showed the average new mortgage being written has ballooned to $500,000 nationally. Commsec chief economist, Craig James, said the build up in debt was a "risk" for the economy.
"The Reserve Bank is clearly watching it very carefully," he said. However, higher home values were underpinning higher debts. "It's not like everyone is going out and buying a Maserati with the money – they're buying an asset which appreciates in value. It's a positive thing."
Graham Cooke, insights manager at comparison website Finder, said super-sized mortgages meant super-sized savings for borrowers who shop around.
Many lenders are offering mortgages with a "2" in front, Mr Cooke said, including Reduce (2.69 per cent), Well Home Loans (2.72 per cent), Home Star (2.74 per cent), UBank (2.84 per cent), Athena (2.84 per cent), loans.com.au (2.88 per cent), Mortgage House (2.88 per cent) and HSBC (2.95 per cent).
"A small reduction to your home loan interest rate could lead to substantial savings in the long run," Mr Cooke said.
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