"A rate hike tomorrow would see more than half an average worker's wage consumed just in serving their mortgage and hit harder than the 17% rates in the 1990s", said Shadow Treasurer, Tim Wilson.
In 1990, interest rates were 17% for the first few months of the year. That period is regularly cited as the most significant period of financial stress for Australian households. At the time, the average repayment on the average new home loan accounted for 42% of a full-time wage, and 32% of household income.
In the June quarter 2026, interest rates were above 6 per cent. They were ~6.15%. At the time the average repayment on the average new home loan accounted for 49% of a full-time wage, and 35% of household income.
After the September rate rise, interest rates are ~6.4% (with the rate rise fully passed on). The average repayment on the average new home loan now accounts for 51% of a full-time wage, and 36% of household income.
In November, if the Reserve Bank increases interest rates, they will be ~6.65% (with the rate rise fully passed on). Based on the latest data, the average repayment on the average new home loan will be 52% of a full-time wage, and 37% of household income.
In the June quarter 2022, interest rates were at 2.78%. At the time, the average repayment on the average new home loan accounted for 33% of a full-time wage, and 23% of household income.
Shadow Treasurer, Tim Wilson, said that as families are already dealing with some of the toughest mortgage conditions in decades, Jim Chalmers' active inflation agenda was daring the Reserve Bank to increase interest rates further.
"In the 1990s Australians were crunched by 17 per cent interest rates, but on current debt levels we are paying more today under Anthony Albanese and Jim Chalmers than Paul Keating", Mr Wilson said.
"The International Monetary Fund and Australia's Reserve Bank is saying the Albanese government's spending addiction is causing inflation and higher interest rates, and Australians going to the supermarket are paying more and getting less".
"Because Jim Chalmers refuses to kick his spending addiction, more than half of an average wage is now being consumed just so families don't lose their home, and with current debt levels it's crunching Australians more than 17 per cent interest rates in the 1990s".
"If Jim Chalmers kicked his spending addiction, then inflation and interest rates would come down and mean families could stop taking items out of their trolley and putting them back on the shelf, instead he's doubling down and causing shrinkflation at the supermarket and across the Australian economy".
Repayments as a share of a full-time wage
Key data
| Benchmark | Interest rate (%) | Average home loan ($) | Average monthly repayment ($) | Average monthly full-time wages ($) | Repayment of wages (%) | Average monthly household income ($) | Repayment of household income (%) |
| February 1990 | ~17% | $67,000 | $960 | $2,274 | 42% | $2,982 | 32% |
| June quarter 2022 | ~2.78% | $611,000 | $2,500 | $7,669 | 33% | $10,770 | 23% |
| June Quarter 2026 | ~6.15% | $731,000 | $4,450 | $9,029 | 49% | $12,681 | 35% |
| After the September 2026 rise (fully passed on) | ~6.4% | $731,000 (most recent data) | $4,570 | $9,029 | 51% | $12,681 | 36% |
| November 2026 (if rates rise, fully passed on) | ~6.65% | $731,000 (most recent data) | $4,690 | $9,029 | 52% | $12,681 | 37% |
Sources: ABS Housing Finance for Owner Occupation, February 1990 (5609.0)
ABS Lending Indicators (5601.0)
ABS Average Weekly Earnings (6302.0)
ABS Household Expenditure Survey, 1988-89 (6530.0) and Household Income and Wealth, 2019-20 (6523.0)
RBA tables F5 and F6, and Monetary Policy Decision, 29 September 2026
RBA Occasional Paper 8, Table 3.3
Repayments are 30-year principal and interest, to the nearest $10. Rates are the banks' standard variable rate in 1990, then the average on new owner-occupier loans. A full-time wage is full-time adult ordinary time earnings. Household income is the survey average grown by wages. Incomes are before tax and monthly (weekly × 52 ÷ 12). Rate rise rows add 0.25 points a rise to the June quarter 2026 rate. The 1990 loan includes refinancing.
