Nearly one in four borrowers are now seen as negative on their financial outlook
Borrower confidence has weakened as interest rates and cost-of-living pressures continue to strain household budgets, according to the Mortgage and Finance Association of Australia’s (MFAA) latest Market Sentiment Survey.
The February 2026 survey, based on responses from 443 MFAA brokers nationwide, indicates a shift away from optimism. Brokers reported that 24.2% of borrowers are now negative about their financial outlook, up 5.3 percentage points since the previous survey in August 2025.
A majority of borrowers (55.3%) were described as neutral, an increase of 8.5 percentage points, while the share seen as positive fell to 20.5%.
MFAA chief executive Anja Pannek (pictured right) linked the change in sentiment to the renewed focus on rates following the Reserve Bank of Australia’s (RBA) previous cash rate move.
“Our February survey was conducted shortly after the RBA increased the cash rate to 3.85%, and brokers are already seeing how that shift is influencing borrower sentiment,” said Anja Pannek, chief executive officer at the Mortgage and Finance Association of Australia.
“With the Reserve Bank meeting on Tuesday and markets expecting further tightening, borrowers will be increasingly focused on managing home loan repayments and household budgets.”
In the survey, interest rates became the most cited reason brokers gave for borrowers adopting a neutral stance, moving up from third place in August. Cost-of-living pressures remained the leading driver of negative sentiment, while housing supply constraints ranked third among factors contributing to caution. For borrowers described as positive, brokers pointed to equity position, job security and savings as the main supports.
Regional differences were also reported. Western Australia recorded the highest level of negative sentiment, which brokers attributed to concerns about housing supply and availability. Queensland borrowers were described as the most positive, supported by stronger equity positions and employment conditions.
The survey also tracked broker activity over the past six months. Almost all brokers (97%) said they had helped clients secure a discount on their loan, and the same proportion reported assisting borrowers to refinance to a new lender. A further 84% said they had supported clients with budgeting strategies.
“Ongoing global uncertainty, including tensions in the Middle East and the impact on inflation, will likely add to borrower caution. This reinforces the value of mortgage brokers supporting their clients through changing market conditions,” Pannek said.
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