The RBA lifted the cash rate to 3.85% in February 2026, then to 4.10% at its March meeting — two consecutive rises, the first back-to-back hikes since the 2022-23 tightening cycle. A Roy Morgan survey taken against that 3.85% environment (before the March move was priced in) found that 26.6% of mortgaged households — 1.41 million — were in mortgage stress. The March rise won't show up until Roy Morgan's next release.
That number gets repeated a lot. It is accurate. But 1.41 million households are not all in the same position, and knowing which group you belong to matters for how you think about your own situation.
What "stress" actually means in the data
Roy Morgan's measure is based on repayments as a share of after-tax income. Below 25% is considered comfortable; 25-45% is "at risk"; above 45% is "extremely at risk." Of the 1.41 million total, 1.18 million are in the at-risk band and a further 232,000 are in the extremely-at-risk band.
The RBA's Financial Stability Review (FSR), published in March 2026, looks at the same population differently. It tracks: how many borrowers have a debt-service ratio above 30% of gross income; how many have little or nothing in offset accounts relative to what they owe; how many recent loans were written at debt-to-income ratios at or above 6; and how many borrowers have less than 20% equity remaining (LVR above 80%).
These two approaches don't produce the same list of people. A household making large repayments but sitting on a substantial offset balance looks stressed by the Roy Morgan measure, but has a real cash cushion available. A household with lower repayments but no offset savings and thin equity looks fine on the headline — but a job loss or another rate rise would hit them fast. The FSR is designed to find that second group.
Three groups inside the 1.41 million
Recent buyers with small deposits and no offset savings. This is the group the FSR's indicators are specifically built to identify. These borrowers entered the market with small deposits, are often on a single income, and have had neither the time nor the breathing room to build offset balances. Their repayments have climbed from the low-rate environment of 2021 and their equity buffers are thin. The FSR notes that the share of new lending at debt-to-income ratios at or above 6 stayed elevated through 2024-25 before pulling back slightly. These borrowers have the least room to absorb a further rate move or an income disruption.
Established borrowers with offset savings. The RBA's household survey data, reported through the FSR, shows that a large proportion of mortgaged households hold offset or redraw balances covering several months to several years of repayments. The FSR notes that aggregate offset and redraw balances across the mortgage book remain at elevated levels. Roy Morgan flags many of these households on the income ratio alone, but the actual cash pressure is significantly softer than the headline implies. Their equity positions are also generally stronger, having bought earlier.
Investors on interest-only or partially offset loans. Their risk is a different shape again — concentrated in rental yield coverage, vacancy, and what refinancing looks like at loan maturity, rather than the income-shock vulnerability that affects owner-occupiers in the first group. The FSR notes that investor arrears have risen from a low base but remain contained relative to historical stress periods.
What the FSR says about genuine fragility
The FSR's most useful signal is whether a borrower's serviceability buffer — the margin APRA requires lenders to test at when a loan is approved — has been eaten through by cumulative rate rises. APRA requires lenders to test at 3 percentage points above the loan rate. The cumulative cash rate movement from May 2022 to March 2026 now exceeds that 3 percentage point buffer for a meaningful segment of loans originated at the bottom of the rate cycle in 2020-2022.
The FSR doesn't publish this as a single figure, but the implication is clear: a portion of the outstanding mortgage book is now in a position APRA's origination tests didn't contemplate.
On equity, the picture is more reassuring. The LVR data in the FSR shows that most mortgaged households — particularly those who bought more than three years ago — have substantial equity. Property values haven't fallen sharply in aggregate, and the proportion of borrowers in negative equity remains low. For most of the book, the risk is in servicing capacity, not in being underwater.
What this means for your property plans
The FSR's March 2026 discussion of household resilience notes that the RBA's Chart Pack records residential property representing roughly 55-66% of total household wealth (depending on how investment property and superannuation are cut). For households whose wealth is concentrated in a home plus one investment property, the concentration into Australian residential is close to total. The FSR flags the diversification question as being as important as the serviceability question.
If you are in the 1.41 million, the next 12 months turn on three things: whether rates move again, whether employment conditions hold, and whether your refinancing terms stay accessible when your loan rolls over. The key is knowing which of the three groups above your situation most closely resembles — because the right response to each is different.
Adapted from SiteLogic Journal. Every fact traces to a primary source. Sources: RBA Financial Stability Review March 2026; Roy Morgan Mortgage Stress Report February 2026; RBA Statement of Monetary Policy March 2026; ABS Household Income and Wealth, Australia 2023-24; RBA Chart Pack, May 2026.