\u201cThe financial position of most households and businesses is strong,\u201d the report \u2014 released last week and taking into account global and economic factors as recently as March \u2014 states.<\/p>\n
Know the news with the 7NEWS app: Download today Arrow<\/a><\/p>\n Even with inflation, rate rises and the war in the Middle East, it said most Australians will be able to withstand further \u201cfinancial downturns\u201d.<\/p>\n It adds the share of mortgagors in severe financial stress \u201cis small\u201d.<\/p>\n The report highlights how most mortgage-holders are rebuilding their safety nets in the form of savings buffers, especially in the wake of the global COVID-19 pandemic.<\/p>\n Despite two rate hikes already this year, the RBA said only a little over 1 per cent of variable\u2011rate owner\u2011occupiers are estimated to be in a cash\u2011flow shortfall \u2014 and that number has fallen sharply since mid\u20112024.<\/p>\n Even fewer are at real risk of defaulting. Just 0.3 per cent of borrowers are both short on cash flow and low on savings buffers, according to the RBA.<\/p>\n It found housing loan arrears have dropped back to pre\u2011pandemic levels, supported by low unemployment and rising wages.<\/p>\n The RBA said many households had been quietly rebuilding their savings buffers as real disposable incomes have been rising since late 2024, boosted by at the time falling inflation, lower interest rates and the Stage 3 tax cuts.<\/p>\n Many households have continued to tip extra money into offset and redraw accounts, \u201clifting\u201d savings buffers across all income groups.<\/p>\n And skyrocketing housing prices \u2014 rising up to 18 per cent in four years \u2014 combined with fewer than 1 per cent of borrowers in negative equity gives many homeowners another safety valve if they do find themselves in trouble, according to the RBA.<\/p>\n The report also said businesses are holding up. Company insolvencies have mostly stabilised, with trouble largely confined to hospitality and construction \u2014 sectors already under pressure for years.<\/p>\n The RBA says there is \u201clittle evidence\u201d of financial stress among commercial property owners and no sign that business lending is becoming dangerously risky.<\/p>\n The central bank acknowledges global risks, including conflict in the Middle East, could push up costs again. And it warns lenders not to loosen standards as credit growth accelerates.<\/p>\n But overall, the message is clear: Australia\u2019s households and businesses are far more resilient than the national mood suggests.<\/p>\n The RBA concludes that even under severe economic shocks \u2014 including a major labour\u2011market downturn or a 40 per cent crash in house prices \u2014 most borrowers would still be able to service their debts.<\/p>\n <\/p>\n Teacher arrested after allegedly grooming teen girl<\/p>\n 1 min read<\/p>\n![\"The](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/04\/df26280fa92cf97055e96594b4355c0b70f5fda1-16x9-x0y0w1920h1080.png\")
The Reserve Bank has said very few Australians are falling behind on their mortgage repayments. Credit: 7NEWS<\/p>\n