As the Australian housing market continues its relentless ascent, the once unthinkable has become a reality for many homebuyers: a $1 million mortgage. But what does that truly mean for your bank balance? The numbers may shock you.
According to the latest data from RateCity, a 30-year mortgage on a $1 million home can cost between $6,700 to $8,200 per month, depending on your down payment and interest rate. That's a staggering amount, equal to the annual income of many Aussie families.
The Hidden Costs of Borrowing Big
But the monthly payments are just the tip of the iceberg. Over the life of a 30-year loan, you could end up paying over $1 million in interest alone - more than the home's original price tag. And that's not counting the additional expenses like property taxes, insurance, and potentially private mortgage insurance (PMI) if your down payment is less than 20%.
"What this really means is that buying a million-dollar home isn't just about scraping together a massive down payment," explains financial analyst Mark Bristow. "It's about committing to decades of hefty monthly payments that can severely strain your household budget."
Is a $1 Million Mortgage Worth It?
The bigger picture here is that securing a jumbo loan of this size is a major financial decision that shouldn't be taken lightly. While it may be tempting to stretch your budget for a luxury property, experts caution that the long-term costs could leave you house-rich but cash-poor.
Ultimately, whether a $1 million mortgage makes sense comes down to your individual financial situation and long-term goals. But one thing is clear: the price of an Australian dream home has never been higher.