Key takeaways
While marketed as a way to ease repayments and help first-home buyers, stretching mortgages over five decades doesn’t make housing cheaper; it simply spreads debt further into the future and traps borrowers in lifelong financial commitments.
Every time policymakers increase borrowing capacity — through grants, guarantees, or now ultra-long loans — prices rise to absorb that new spending power.
A 50-year mortgage is just another demand-side stimulus that worsens, rather than improves, housing accessibility.
A 50-year loan roughly doubles the total interest paid compared to a 30-year mortgage. Borrowers face slower equity growth, greater exposure to interest-rate risks, and less financial flexibility — effectively “renting money” from the bank for life.
With Australia’s ageing population, 50-year mortgages are unrealistic for many — someone borrowing at 40 would still be paying at 90.
This raises concerns about retirees carrying debt and potentially passing liabilities across generations, undermining financial resilience.
Genuine solutions lie in addressing the root causes: boosting housing supply in desirable areas, reforming planning systems, improving infrastructure, and supporting productivity-led wage growth.
Debt-driven affordability is “fake affordability” — it treats symptoms, not causes.
What if the latest idea to fix Australia’s housing crisis is actually a ticking time bomb?
Politicians and banks are floating the concept of 50-year mortgages as though they’re a lifeline for struggling buyers, promising smaller repayments and an easier path into the market.
But look a little closer and the picture becomes far less comforting.
Could stretching our home loans across half a century actually make housing more expensive, saddle Australians with unprecedented levels of debt, and push us down the same path as countries where mortgages outlive the people who take them out?
Before we celebrate this as an affordability breakthrough, it’s worth asking a confronting question: is a 50-year mortgage solving the wrong problem entirely?
On the surface, long-term loans feel like a modern fix for a modern problem, the kind of policy tweak that might finally help young families and frustrated first-home buyers bridge the widening gap between wages and property prices.
But affordability has never been about shaving a few hundred dollars off monthly repayments.
It’s about ensuring Australians can build wealth, reduce risk, and ultimately own their homes in a reasonable timeframe.
And that’s precisely where ultra-long mortgages start to unravel.
Once you factor in the extra decades of interest, the slower pace of equity growth, and the way increased borrowing capacity inevitably pushes prices higher, it becomes clear that 50-year mortgages don’t improve accessibility at all.
They simply shift the burden further into the future – and onto buyers least equipped to carry it.
The reality: they make homes more expensive, not less
Every time you artificially increase borrowing capacity, property prices adjust upward accordingly.
We’ve seen this repeatedly in Australia:
- First Home Owner Grants
- Boosted FHOG during the GFC
- HomeBuilder
- Stamp duty concessions
- Even the First Home Guarantee scheme
Each one of these pumped additional purchasing power into the entry-level market… and the price rises quickly absorbed the benefit.
A 50-year mortgage is just another demand-side stimulus. More people can borrow more money, which means prices rise faster.
So accessibility doesn’t improve. It deteriorates.
A 50-year loan roughly doubles the total interest you’ll pay compared to a 30-year loan.
In other words, you’re renting money from the bank for most of your natural life.
You take on:
- A much longer debt horizon
- Much higher total interest
- Slower principal reduction
- More vulnerability to interest-rate shocks
- Less capacity to borrow again for upgrading or investing
For wealth creation, this is poison. A 50-year loan slows that wealth-building engine dramatically.
Demographics make the idea even less practical
Australia is aging fast. If someone starts a 50-year mortgage at 40 - which is not uncommon for upgraders - they’re paying off the home at 90.
Banks already restrict loan terms based on retirement age, so 50-year terms aren’t even realistic for a big chunk of the population.
And do we really want to see retirees still paying off their homes?
It creates systemic risks we don’t talk about
Countries that use ultra-long mortgages, like Japan, haven’t exactly solved affordability. Many of their loans require generational guarantees because people can’t pay them off within one lifetime.
Do we want Australian households carrying debt loads that stretch across generations?
It’s the opposite of financial resilience.
There are better solutions
If the goal is genuine affordability, longer mortgage terms aren’t the lever that works.
Australia should be focused on:
- Boosting supply in the right locations
We need more medium-density, family-friendly homes where people want to live - not fringe housing estates. - Building infrastructure that unlocks new areas
Transport, schools, hospitals - that’s what makes outer suburbs viable. - Reforming planning systems
Streamline approvals and zoning. This is a chronic bottleneck. - Stop relying solely on private mum-and-dad investors for rental stock
Reintroduce institutional investment in build-to-rent and social housing. - Encourage better-than-average wage growth through productivity, not debt
Debt-driven affordability is fake affordability.
My view, in summary
A 50-year mortgage doesn’t make homes more accessible. It just stretches households thinner, raises long-term risk, and pushes prices up.
It’s treating the symptom, not the disease.
What will genuinely help affordability is addressing supply constraints, planning inefficiencies, and the demographic forces reshaping Australian cities.
