This is up 16 per cent year-on-year and hit 1.47 per cent last month alone – the highest level before Covid, when mortgage arrears were at 1.49 per cent in March 2020.

While mortgage arrears are rising, they are still at historically low levels. And potential homeowners are not willing to take on the huge debt of a few years ago, with new household lending down 8 per cent year-on-year.

The latest mortgage lending data from the Reserve Bank shows there was $3.4 billion of mortgage lending in January, down 35.6 per cent from $5.3 billion lent in December. This is historically low. In January 2021 there was $6.4 billion of lending.

Centrix data shows the average mortgage loan for first home buyers was $540,000 in the fourth quarter of last year, falling 9 per cent from a peak of $594,000 in the first quarter of 2022 during the Covid property market boom.

The Trend

Centrix managing director Keith McLaughlin says the rise in mortgage arrears definitely points towards a normalising trend.

Reserve Bank data also shows non-performing housing loans rose 10.6 per cent, or $160 million, in January.

This is a year-on-year increase of $721 million, with the current level now at $1,678 million.

However, arrears haven’t resulted in a slew of mortgage sales. They were up to 81 in the last quarter – the highest since 2017, according to CoreLogic data, but well down on the numbers seen through the global financial crisis (GFC), when in the third quarter of 2009 they hit 767.

CoreLogic’s chief property economist says the risk for more mortgagee sales is still there with 55 per cent of existing mortgages still to be repriced to higher interest rates over the next year.