Mortgage Repayment Amounts Australia (2026) — by Loan Size
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Mortgage Repayment Amounts Australia (2026)
How much will your mortgage repayments be? The answer depends on your loan amount, interest rate and loan term. This guide breaks down exact repayment figures for every major loan size — from $300,000 to $1,500,000 — using current Australian interest rates.
At a 6.00% p.a. variable rate over 30 years, here is what monthly repayments look like across common loan sizes:
| Loan Amount | Monthly Repayment | Fortnightly | Weekly |
|---|---|---|---|
| $300,000 | $1,799 | $831 | $415 |
| $400,000 | $2,398 | $1,107 | $554 |
| $500,000 | $2,998 | $1,384 | $692 |
| $600,000 | $3,598 | $1,661 | $831 |
| $700,000 | $4,197 | $1,937 | $969 |
| $800,000 | $4,797 | $2,214 | $1,107 |
| $900,000 | $5,396 | $2,490 | $1,245 |
| $1,000,000 | $5,996 | $2,767 | $1,384 |
| $1,500,000 | $8,994 | $4,151 | $2,076 |
Based on principal and interest, 30-year term, 6.00% p.a. Actual repayments depend on your lender and rate.
Repayment Guides by Loan Amount
- $300,000 Mortgage Repayments
- $400,000 Mortgage Repayments
- $500,000 Mortgage Repayments
- $600,000 Mortgage Repayments
- $700,000 Mortgage Repayments
- $800,000 Mortgage Repayments
- $900,000 Mortgage Repayments
- $1,000,000 Mortgage Repayments
- $1,500,000 Mortgage Repayments
Topic Guides
- Average Mortgage Repayment in Australia (2026)
- True Cost of Homeownership in Australia
- What Does a 0.5% Rate Difference Cost Over 30 Years?
How Repayments Are Calculated
Australian home loan repayments are calculated using the standard principal-and-interest (P&I) amortisation formula. Each repayment covers interest charged on the outstanding balance plus a portion of the principal. In the early years, the majority of each repayment goes toward interest — this shifts toward principal over time.
Key variables that affect your repayment:
- Loan amount — the amount borrowed (not the property purchase price)
- Interest rate — the annual percentage rate set by your lender
- Loan term — typically 25 or 30 years in Australia
- Repayment type — principal and interest (P&I) or interest-only (IO)
Fortnightly repayments are calculated as monthly × 12 ÷ 26. Paying fortnightly instead of monthly effectively adds one extra monthly repayment per year, which can reduce the loan term and total interest significantly.
Effect of Interest Rate on Total Repayments
Interest rate has a large impact on both monthly repayment and total interest paid. For a $500,000 loan over 30 years:
| Rate | Monthly Repayment | Total Interest Paid |
|---|---|---|
| 5.50% | $2,840 | $522,400 |
| 6.00% | $2,998 | $579,280 |
| 6.50% | $3,162 | $638,320 |
| 7.00% | $3,327 | $697,720 |
| 7.50% | $3,496 | $758,560 |
A 1% difference in rate costs approximately $160–$175 more per month on a $500,000 loan — and over $100,000 more in total interest over 30 years. See the full analysis in What Does a 1% Rate Difference Cost?
Repayment and Borrowing Power
To borrow a given loan amount, you need sufficient income to meet your lender’s serviceability assessment. Australian lenders apply a 3% buffer above the actual interest rate (required by APRA) when assessing your capacity to repay.
For income guidance, see the Mortgage Affordability guides — including articles on how much you can borrow at specific salary levels.
Principal and Interest vs Interest-Only Repayments
Most Australian home loans are principal and interest (P&I) — each repayment covers both the interest on the outstanding balance and a portion of the loan itself. Some borrowers, particularly investors, use interest-only (IO) periods of 1–5 years, where repayments cover only interest.
The trade-off is significant:
| Loan type | Monthly repayment ($600k, 6%, 30yr) | Total paid over 30 years |
|---|---|---|
| Principal & interest | $3,598 | $1,295,280 |
| Interest-only (5yr) then P&I (25yr) | $3,000 (IO) → $3,860 (P&I) | ~$1,374,000 |
Interest-only costs more over the full term because the principal doesn’t reduce during the IO period. For owner-occupiers, APRA requires lenders to assess IO loans under stricter criteria.
The Power of Extra Repayments
Making additional repayments above the minimum can dramatically reduce your loan term and total interest paid. For a $600,000 loan at 6.00% over 30 years:
| Extra repayment per month | Years saved | Interest saved |
|---|---|---|
| $200 | ~2.5 years | ~$47,000 |
| $500 | ~5.5 years | ~$105,000 |
| $1,000 | ~9 years | ~$183,000 |
Most variable rate loans allow unlimited extra repayments without penalty. Fixed rate loans often cap extra repayments at $10,000 per year — exceeding this triggers a break cost.
Offset Accounts — How They Reduce Interest
A mortgage offset account is a transaction account linked to your home loan. The balance in the offset reduces the loan principal used to calculate interest each day.
Example: $600,000 loan with $40,000 sitting in the offset account = interest is charged on $560,000 only. At 6.00%, this saves approximately $2,400/year in interest. The savings are equivalent to earning 6.00% on your savings — tax-free (unlike a savings account, no interest income is generated, so no tax applies).
Offset accounts are typically available on variable rate loans. Many lenders charge a small premium (0.10%–0.20% on the rate) for this feature — whether this is worth it depends on how much you hold in the offset at any given time.
25-Year vs 30-Year Loan Terms
Most Australian home loans are structured over 25 or 30 years. A shorter term means higher repayments but substantially less total interest:
| Loan term | Monthly repayment ($600k, 6%) | Total interest paid |
|---|---|---|
| 30 years | $3,598 | ~$695,000 |
| 25 years | $3,866 | ~$560,000 |
| 20 years | $4,302 | ~$432,000 |
The choice between 25 and 30 years depends on your cash flow — a 30-year loan offers more flexibility, with lower mandatory repayments you can always exceed voluntarily.
Frequently Asked Questions
What is the average Australian mortgage repayment in 2026?
Based on the median outstanding loan balance across Australian borrowers (approximately $500,000–$600,000 for recent purchasers) and current variable rates around 6.00%–6.50%, the average monthly repayment for recent home buyers is roughly $3,200–$4,000. Existing borrowers with smaller outstanding balances pay significantly less.
Can you fix part of your loan and leave part variable?
Yes — this is known as a split loan. Many borrowers fix a portion (e.g., 60–70%) for rate certainty while keeping the remainder variable to retain offset and extra repayment flexibility. Banks and lenders offer this commonly in Australia.
How does the RBA cash rate affect my repayments?
Variable rate loans are priced at a margin above the RBA cash rate. When the RBA raises the cash rate, lenders typically pass the increase on to variable rate borrowers within days. A 0.25% (25 basis points) increase on a $600,000 loan adds approximately $90/month to repayments.
Principal and Interest vs Interest-Only Repayments
Most Australian home loans are structured as principal and interest (P&I) — each repayment reduces the outstanding loan balance while covering interest. A smaller proportion of borrowers, predominantly investors, use interest-only (IO) loans where repayments cover only the interest charge and the principal balance does not reduce.
| Feature | Principal & Interest | Interest Only |
|---|---|---|
| Monthly repayment (lower is…) | Higher | Lower |
| Loan balance over time | Reduces each payment | Stays the same during IO period |
| Total interest paid | Lower | Higher |
| Equity built | Yes — each payment | No — must rely on capital growth |
| IO period available | Not applicable | Typically 1–5 years (max 10 years for investors) |
| After IO period ends | — | Reverts to P&I (repayments jump substantially) |
APRA tightened restrictions on IO lending after 2017 due to concerns about investor leverage. IO loans now carry a higher interest rate than equivalent P&I loans — often 0.50%–0.80% more.
For owner-occupiers, P&I is almost always the right choice: you build equity with every repayment and pay less total interest over the loan term. IO loans are used by some investors to maximise negative gearing tax deductions during the IO period — but the interest rate premium must be weighed against the deduction benefit. Speak with a registered tax agent or financial adviser before choosing IO purely for tax reasons.
What happens when the IO period ends?
When the IO period expires, the loan automatically reverts to P&I repayments — but over the remaining loan term. If you had a 30-year loan with a 5-year IO period, you have 25 years left to repay the full principal. This means repayments jump significantly at the IO-to-P&I transition.
Example: $700,000 loan at 6.50%, 5-year IO followed by 25-year P&I
- IO repayments (years 1–5): ~$3,792/month (interest only)
- P&I repayments (years 6–30): ~$4,707/month (principal + interest over 25 years)
Borrowers who are unprepared for this transition can face repayment stress. APRA requires lenders to assess serviceability at the P&I rate before approving IO loans.