Declining Borrower Confidence in the Face of Rising Mortgage Rates

According to the survey, conducted in February 2026, nearly a quarter of borrowers (24.2%) now hold a negative view of their financial future, marking a 5.3 percentage point increase since August 2025. Additionally, over half (55.3%) of respondents maintain a neutral stance, while the proportion of those feeling positive has dwindled to 20.5%.

MFAA CEO Anja Pannek attributes this shift in sentiment to the current interest rate environment, which has re-emerged as a key driver of financial uncertainty. The Reserve Bank of Australia's (RBA) recent rate hikes have led to higher mortgage repayments, placing additional strain on household budgets already stretched by rising living costs.

For borrowers, this environment underscores the importance of proactive financial management. Engaging with lenders to discuss potential refinancing options, exploring fixed-rate mortgages to hedge against future rate increases, and seeking professional financial advice can provide strategies to navigate these challenges.

It's also crucial for borrowers to stay informed about market trends and policy changes that may affect their financial situation. Regularly reviewing and adjusting household budgets to accommodate changing expenses can help maintain financial stability during periods of economic uncertainty.

In conclusion, the decline in borrower confidence reflects the broader economic challenges facing Australian households. By taking proactive steps and seeking appropriate guidance, borrowers can better position themselves to manage the impacts of rising mortgage rates and cost-of-living pressures.