Comparison group Mozo looked at the median houses prices across 29 different suburbs in Sydney to calculate what a cash rate hike to 1.5 per cent would mean for mortgage holders with a 50 per cent lend.

The results were varied, with borrowers in suburbs such as Manly, Vaucluse and Rose Bay likely to pay about $2,000 more each month and those in more affordable suburbs such as Penrith and Liverpool needing to commit an extra $300.

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It followed the results of a national survey commissioned by the comparison site which found 80% of borrowers were worried about interest rates rising, with seven per cent believing they would need to sell their property once this occurred.

Figures from the ABS showed the average loan size in NSW in December 2021 was almost $180,000 higher than the national average of $602,000.

While there wasn’t loan data from Sydney to draw on, Mozo used the median house prices from the same period across different suburbs and calculated mortgage size by halving the amount.

This was under the premise that a 50 per cent loan to value ratio represented the middle ground between those who had recently bought with a 20 per cent deposit, and those who were close to paying their mortgage in full.

The results showed that mortgages held by Sydneysiders were potentially much larger than the state average, ranging from $316,250 to $3,575,000 across the 29 suburbs sampled.

To predict the average variable rate if the cash rate went to its May 2019 level of 1.5 per cent, Mozo calculated the basis point difference between the current cash rate (0.10) and the average variable rate in the Mozo database (3.06 per cent), and then applied that to a 1.5 per cent cash rate scenario.

They then used the new variable of 4.46 per cent to determine what a borrower with a 50 per cent loan to value ratio would need to pay each month over a 25-year loan term.

The highest median sampled was $7,150,000 in Vaucluse. Monthly repayments on a 50 per cent lend of $3,575,000 would go from $17,065 to $19,790 if the variable increased from 3.06 per cent to 4.46 per cent.

In the north western suburb of Bella Vista, repayments would increase by about $820 a month to $5,999 based on the median house price of $2,167,500.

Based on Cronulla’s median of $2,550,000, repayments would go up from $6,086 to $7,058, while repayments in Wentworthville would increase by about $400 a month to $3,055, based on the median of $1,103,750.

Mozo spokesman Tom Godfrey said it was time for borrowers to start stress-testing their ability to make higher repayments.

“With fixed interest rates continuing to rise and speculation intensifying around when the banks will hike variable rates, many borrowers will be in for a shock before the year is out,” he said.

“The last time the cash rate was 1.5 per cent in May 2019, Mozo’s database shows the average variable interest rate 4.32 per cent which is significantly higher than the 3.06 per cent it is today.”

“While some suburbs might be harder hit by a rate rise than others, no matter where you live, the pain you feel will ultimately come down to your servicing capacity.”

He recommended building up a buffer in an offset facility in order to mitigate against higher repayments before they hit.

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Originally published as How much Sydney loan repayments will increase when the cash rate hits 1.5 per cent