Roy Morgan Update April 23, 2024: ALP Support up, Consumer Confidence & Mortgage Stress

In this week's Update, we present the latest data on Primary Voting Intention, Consumer Confidence & Mortgage Stress.

Welcome to the Roy Morgan Weekly Update.

In a week that saw Israeli strikes on Iran which had the potential to set off a wider war in the Middle East, two knife attacks in Sydney, and the judgment handed down against Bruce Lehrmann, the Labor Government has regained the lead on a two-party preferred basis with support up 3% to 52% to be ahead of the Coalition on 48%.

However, the increasing two-party preferred support for Labor is not due to a significant increase in the Labor vote but rather a collapse in the Liberal vote – and an increase for the Greens who’s preferences flow to Labor.

If an election were held now the ALP would be re-elected with a slim majority as they have now, the latest Roy Morgan Poll shows.

There were mixed results with other key indicators this week.

Roy Morgan Government Confidence dropped 2pts to 76.5 and well below the neutral level of 100.

Now under a third of Australians, 31%, say the country is heading in the right direction while a majority of 54.5% say the country is heading in the wrong direction.

In terms of consumers, ANZ-Roy Morgan Consumer Confidence dropped 3.2pts to 80.3 this week – its lowest so far this year.

Consumer Confidence has spent a record 64 weeks below the level of 85. Looking back over the last few months, Consumer Confidence has now moved in a narrow band of 80-85 over the last 20 weeks (or four months) since early December.

A we must keep reminding ourselves, although the Reserve Bank have not increased interest rates since November, the momentum in mortgage stress and cost of living pressures continues unabated – keeping a lid on Consumer Confidence.

The RBA next meets in two weeks’ time – the week before a potentially pre-election Federal Budget.

In better news this week, Inflation Expectations were marginally down for a second straight week, down by 0.2% to 5.0%. Australians now expect annual Inflation to be 5.0% over the next two years.

Like Consumer Confidence, Inflation Expectations have stayed within a narrowband of 4.8% to 5.3% since early December.

And now to the latest figures on mortgage stress – and the news is good.

Roy Morgan is the only company to measure ‘mortgage stress’ every month. The latest ‘mortgage stress’ figures show a decline of 98,000 in March to 1,531,000 mortgage holders – 30.3% of all Australians with a mortgage are ‘At Risk’ of mortgage stress.

The level of mortgage stress is the lowest so far this year.

The decline in mortgage stress is primarily due to rising household incomes which along with the extended pause in interest rate increases for the last five months since November 2023 has allowed this growth to “catch up” and reduced the financial pressure on some mortgage holders.

The same reduction in mortgage stress was seen after the RBA paused rate increases for four months from July – October 2023.

As a comparison the level of mortgage stress in March is very similar to the number of mortgage holders considered ‘At Risk’ of mortgage stress in the three months to December 2023 which was 1,527,000 (30.3%).

In addition, 18.7% of mortgage holders were considered to be ‘Extremely At Risk’, equivalent to 918,000 mortgage holders who are at risk of being unable to pay even the interest component of their loan.

Looking forward we will have new official ABS Inflation numbers for the March quarter tomorrow and in two weeks the Reserve Bank next meets to consider changing interest rates.

The week after that is a potential pre-election Federal Budget – so there is plenty to look forward to for those keeping an eye on key policy settings.