The states where mortgage holders are worst hit by interest rate rises

Mortgage holders in some states will be under more stress than others as a result of the recent rise in interest rates.

Last week the RBA hiked the cash rate, with banks and other loan firms passing it on to stretched borrowers.

New research from Roy Morgan shows mortgage holders in Victoria, Queensland and Tasmania are set to be hit hardest.

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The situation is worst in Tasmania with just under a third of mortgage holders deemed "at risk".

Roy Morgan says 29.8 per cent of Tasmanian mortgage holders are "at risk" and if rates increase again next month that figure will climb to 32.6 per cent of mortgage holders.

Next is Victoria, where 27 per cent of mortgage holders are classified as "at risk" and set to increase to 29.9 per cent if there is another RBA interest rate increase.

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An additional RBA interest rate increase next month would hit hard in Queensland. Already 24.2 per cent of mortgage holders are "at risk" and another increase would push that rate to 26.8 per cent, Roy Morgan says.

Mortgage holders in NSW have the lowest level of mortgage stress at 22 per cent.

Mortgage stress is generally when more than 30 per cent of pre-tax income is spent on repayments.

The latest data on mortgage stress shows almost a quarter of holders are now "at risk" of mortgage stress, and the recent interest rate rise is expected to increase this to just more than 25 per cent.

Another interest rate increase in March by 0.25 per cent to 4.1 per cent would increase this to 27 per cent and hit 1.3 million mortgage holders, Roy Morgan said.

New research shows more than a million mortgage holders were struggling with repayments before the Reserve Bank lifted the cash rate last week.

One in three homeowners – equivalent to 1.15 million – said they struggled to pay their mortgage in January, according to a survey by comparison site Finder.

The Reserve Bank's monetary policy board unanimously decided to raise the cash rate by 25 basis points, up to 3.85 per cent, at its first meeting of the year, in a move widely expected by economists.

Commonwealth Bank has now changed its interest rate outlook for the year, joining NAB in pencilling in a hike to 4.10 per cent in May.

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Australian borrowers have been warned to expect even more mortgage pain in the coming months.

In her press conference following the decision, RBA Governor Michele Bullock would not be drawn on whether future hikes were likely.

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