A study of Sydney’s housing market has revealed that 20 per cent of homeowners across the city are currently facing mortgage debt of over $1 million.
According to findings by Digital Finance Analytics (DFA), over 20,000 homeowners have mortgages in the millions, a figure higher than anywhere else in Australia. It is also a historical record.
The research, based on over 50,000 households surveyed, also revealed that 26,000 NSW homeowners were at risk of defaulting on their mortgages.
“COVID has been a catalyst for people who had large mortgages but were previously financially comfortable,” said DFA principal Martin North. “Now those large debts have really come back to bite.
“We have a debt problem,” Mr North said.
“It’s been building for years but now the tide is out and we can see it more. It’s going to look really ugly in the next year.
“A lot of people will be questioning if taking on this much debt was a good idea. I suspect many bought thinking prices would keep growing.”
Further problems may arise if owners decide they need to sell.
“If many of these owners are forced to sell their properties there will not be many people with the funds to buy them,” Mr North explained.
The Sydney suburbs with the most million-dollar mortgages
Chiswick – 22 per cent (of current mortgages)
Lane Cove – 19 per cent
Wahroonga – 16 per cent
Balgowlah – 16 per cent
Maroubra – 14 per cent
Mosman – 14 per cent
Warrawee – 14 per cent
Cronulla – 13 per cent
Randwick – 13 per cent
Naremburn – 12 per cent
Coogee – 11 per cent
Castlecrag – 10 per cent
Strathfield – 10 per cent
Roseville Chase – 10 per cent
Rushcutters Bay – 10 per cent