A cash rate of 4.85% is where the Reserve Bank landed on 3 November 2026, after five increases in a single year. The official mortgage arrears numbers have not blown out. Yet a November poll of 1,012 adults found that 10% of mortgage holders say they cannot afford the repayments that are coming. That is the gap worth studying.
The two measures are not in conflict. They are measuring different moments in time.
Why self-reported stress runs ahead of arrears
Arrears data records a loan that has already missed payments. A survey records how a borrower feels about the bill that has not landed yet. Lenders typically give two to three months’ notice before a higher repayment starts, so many households have been told the number but not yet paid it.
That timing matters. A household can be fully up to date today and still be quietly planning to miss next quarter. Our earlier piece on why mortgage arrears look calm while stress signals stack up makes the same point: arrears are a lagging indicator, and they usually move after unemployment and savings buffers do.
Key numbers
- 4.85%: the cash rate after the fifth hike of 2026
- 10%: mortgage holders who say they cannot afford higher repayments (poll of 1,012 adults)
- 28%: expect financial strain
- 41%: plan to cut spending
- 21%: feel comfortable
- 68%: renters worried about affordability
Reading the poll against the arrears data
Treat the 10% as a ceiling for near-term risk, not a forecast. Saying you cannot afford something is not the same as defaulting. Most people in that group will cut spending, draw on savings, extend hours, or refinance before they miss a payment. The 41% planning to trim spending is the more realistic picture of how this plays out: households absorb the hit in the discretionary budget first.
What the poll does tell us is where the pressure is building. Only about one in five borrowers feel comfortable. That leaves a large middle group, 28% expecting strain, with little room for another surprise.
Which borrowers tip first
Three groups are the most likely to move from stressed to behind.
- Recent buyers with thin equity. They carry the largest loans relative to income and have had the least time to build a buffer.
- Long-standing customers who never switched. Some are paying around 7.34% while the market sits under 6.5%. They are paying more than they need to.
- Households with one income shock away from trouble. A job loss or reduced hours is what converts strain into arrears, which is why unemployment is the number to watch.
None of this requires a housing crash. It requires only a modest rise in people who cannot absorb a higher repayment and a modest fall in the cushion they started with.
The pass-through arrives in stages
The path from the RBA decision to the household budget is not instant. One non-bank lender said it would pass the full increase to variable customers from 19 November, and the four major banks are tipped to follow on 13 November. A comparison-site analysis found that the last variable offers priced under 6% have now gone, with the average owner-occupier variable rate projected at 6.74% and the cheapest at 6.18%.
Fixed rates barely moved beforehand. Sub-6% fixed options fell from twelve to eight in a week, and only one lender raised some fixed rates, by an average of 0.14%. That suggests fixed pricing had already absorbed much of the expected move, so the sharper pain lands on variable borrowers first.
For a wider view of how each hike works through to repayments, see our guide to RBA interest rates and mortgage repayments, and our look at who feels the fifth hike next.
A refinance can close part of the gap
The most practical lever is price. A borrower with $600,000 outstanding and 25 years remaining who moves to a 6.49% loan could save about $9,000 over two years, after roughly $1,150 in switching costs. That figure depends on the starting rate, loan size and what the new lender charges, so it is an illustration, not a promise.
Not everyone can refinance. Some are held back by falling property values, a change in income, or tighter serviceability tests. For them, the first step is to ask the existing lender to review the rate, which costs nothing and sometimes works.
What to watch from here
If arrears stay low through the first full quarter of higher repayments, the poll will look like noise. If they start to climb alongside softer employment, the 10% figure will look like an early warning that was easy to miss.
The next step is simple: check your current rate against the market this week, and know your repayment on the new schedule before the notice period ends. If you want the weekly signal on rates and credit, subscribe to the Australian Property Review newsletter.
General info, not financial advice.
