Queensland’s hidden debt hotspots have been exposed as new data reveals $1m loan burdens
Our chapter on home loans goes much deeper than mortgages alone
Queensland’s debt hotspots have been exposed, with new data revealing households in suburbs across the state are facing debt burdens of more than $1 million per household borrower.
The figures confirm that the huge household debt crisis runs deeper than mortgages alone, as the looming threat of interest rate hikes adds more pressure to Queenslanders trying to secure car loans, credit cards and personal loans.
Digital Finance Economics data shows the average Queensland household has total debt of $346,325, which is higher than the national average of $320,525, but behind the ACT ($779,453) and NSW ($379,167).
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The data shows 19 Qld suburbs where the mortgage was more than three times the state average, including Meikleville Hill, where this house sold for $906,500.
Of that amount, home equity loans accounted for $158,298 and home equity loans for $154,064, while households owed an average of $8,149 in unsecured debt such as credit cards and postpaid purchases, and an additional $25,814 for a car, boat, personal loan, and more.
DFE’s analysis went deeper, identifying 19 suburbs where household debt was more than three times the national average and exceeded $1m.
The regional coastal town of Barney Point, Gladstone, was ranked worst hit, with the average family carrying a staggering $1.63m in total debt, despite a median house price of just $409,660.
Following closely behind are two well-heeled Brisbane suburbs, Highgate Hill and Fortitude Valley, with total household debt of $1.47m and $1.43m respectively.
Rounding out the top 10 places in Queensland with the heaviest debt were Little Mountain, Mermaid Waters, Chapel Hill, Paradise Point, Victoria Point, Meikleville Hill, and Ascot.
Director of Digital Finance Economics, Martin North, said some families are in over their heads.
DFE director Martin North warned that mortgage rates could be much higher than the figures indicated, as the data is weighted by outstanding balances and includes long-term home owners who had overpaid their mortgages, pulling headline figures down.
“We have a number of households, some with no debts, some with manageable debts, but some are over their heads,” he said.
“Recent homebuyers who have made money to buy despite shocking affordability, especially on the fringes of cities, and in high-rises, and first-generation immigrants who brought the market a few years ago are at the front of the pain line.”
Mr North said growing families were among the borrowers most likely to be affected by the rate hike.
Highgate Hill is one of Brisbane’s worst affected areas. This James St house sold for $2.37m
“Because we’ve seen little real income growth since 2007 for many households, the debt burden hangs like a noose around their necks,” he said.
Mr North said the figures revealing non-mortgage debts showed a growing culture of “instant gratification”.
“Many are too strong in their search for a certain way of life and it is usually related to the lack of mortgages that force people to borrow for other things, seeking quick satisfaction,” he said.
While mortgages typically offer lower rates and longer terms, unsecured and consumer loans tend to be more expensive and less flexible, meaning households with subprime mortgages are more likely to feel the sting when rates rise.
Inner-city Fortitude Valley was another area of debt
Finance broker Andre Dixon, of Inovayt, said that while the debt levels are consistent with the big debts in blue-chip areas, they are a sign of buyers stretching their budgets to buy.
“In high-value or high-demand areas, high debt often reflects large debt tied to property values rather than lifestyle,” said Mr Dixon.
Mr Dixon said many prospective buyers did not know how their money could affect their ability to get a loan.
“Many borrowers only focus on their mortgage, but lenders look at all credit. Understanding and managing non-mortgage debt early can make a big difference in your ability to borrow and pay in the long term,” he said.
Equifax solutions chief Kevin James
This rising consumer debt is accompanied by an increase in demand for housing stock, as reported by Equifax.
Loan demand rose to a three-year record, fueled by interest rate cuts, first-time buyer incentives, and rising taxes.
The Equifax Consumer Market Pulse for December showed demand for home loans fell 18 percent compared to the same period last year — the largest monthly increase since 2022.
Equifax’s chief executive, Kevin James, said the increase in housing demand was driven by an expanded First Home Buyer deposit program and three rate cuts last year.
It comes ahead of the Reserve Bank of Australia’s (RBA) Next Board Meeting on Feb 3, where the ASX Rate Tracker this week recorded market expectations of 60 percent of the official money rate rising 0.25 percentage points to 3.85 percent.
On the Gold Coast, households borrowing in Mermaid Waters owe an average of $1.32m
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Knife edge pricing
Compare Markets director of economics David Koch warned that a single rate increase of 0.25 percent could raise monthly payments by nearly $94 for someone with a $600,000 mortgage, an extra $1,128 a year for households that also face higher costs for groceries, insurance, and energy.
“Australians don’t need to panic, but they should be prepared. Reviewing your mortgage, understanding your options, and building financial flexibility now can help soften the blow if rates rise later in 2026,” he said.
