This article was written by Nancy Wang Principal Solicitor at W & G Lawyers.
Each month the Commonwealth Bank publishes its Household Spending Insights report, built from the de-identified transactions of around seven million of its customers, roughly 30 per cent of all consumer transactions in Australia. The August 2026 edition, released on 22 September 2026, paints a picture that many Queensland families will recognise. Spending is still growing, but only just, and the growth that remains is going on the things you cannot avoid rather than the things you enjoy.
We are lawyers, not economists, and this article does not attempt to predict where interest rates or house prices are heading. When household finances tighten, however, the legal questions we see in our office change too. Clients ask about missed mortgage repayments, contracts they can no longer afford to complete, separating when the family home is worth less than it was, and businesses struggling to collect what they are owed. This article sets out what the data shows and what you may want to think about before a financial squeeze becomes a legal problem.
What the CommBank data shows
The headline figures are modest. Household spending rose 0.1 per cent in August on a seasonally adjusted basis, a sharp step down from the 0.6 per cent rise in July. Over the past year spending grew 4.7 per cent on the same basis, down from 5.2 per cent in July. CommBank describes a broad-based slowdown and points to three interest rate rises over the past year, higher fuel prices and declining housing prices as the causes.
Where the money is going tells a clearer story. The strongest gains in August were all essentials. Transport rose 2.0 per cent in the month and 9.0 per cent over the year, driven by petrol prices after the winding back of the fuel excise cut and renewed conflict in the Middle East. Insurance rose 0.9 per cent in the month and 7.9 per cent over the year. Electricity and gas bills were up around 18 per cent over the year as government rebates came to an end.
The categories people can choose to cut are the ones that fell. Household goods spending fell 0.3 per cent in August, and annual growth in that category almost halved from 6.4 per cent to 3.4 per cent. CommBank notes that household goods is generally the first area where it expects to see a pull back when home prices and property turnover fall.
| Category | Monthly change (August, seasonally adjusted) | Annual change (original) |
| Transport | +2.0% | +9.0% |
| Insurance | +0.9% | +7.9% |
| Health | +0.3% | +4.0% |
| Hospitality | +0.1% | +4.3% |
| Utilities | +0.1% | +4.7% |
| Household services | 0.0% | +2.7% |
| Recreation | 0.0% | +4.5% |
| Communications and digital | −0.1% | +5.6% |
| Household goods | −0.3% | +3.4% |
| Food and beverage goods | −0.3% | +2.5% |
| Motor vehicle | −0.5% | +1.2% |
| Education | −1.2% | −5.5% |
Source: CommBank Household Spending Insights, August 2026 (prepared 22 September 2026). Monthly changes are seasonally adjusted; annual changes are in original terms.
Two comparisons in the report stand out. Over the year, spending on essentials grew 4.8 per cent while discretionary spending grew 3.3 per cent, so essentials have overtaken discretionary spending. In August itself discretionary spending contracted, down 0.3 per cent after a 0.7 per cent lift in July, and annual growth in retail spending of 3.8 per cent is the slowest since March 2025.
The picture for Queensland is mixed. Over the past year Queensland was one of the strongest states, with spending up 4.7 per cent, behind only the Northern Territory, and CommBank links that strength to the state’s home prices and population growth. In August itself, however, Queensland spending was flat, and annual growth in the state slowed by 2.1 percentage points between July and August.
Finally, the report separates households by how they hold their home. Over the past year, spending by owners with a mortgage grew 2.3 per cent per person, compared with 0.8 per cent for people who own outright and 1.1 per cent for renters. CommBank observes that the recent slowdown has been more pronounced among households with a mortgage, and it makes a point that deserves attention. Many borrowers left their repayments unchanged when rates were cut in 2025. If the Reserve Bank raises rates again, which CommBank now expects at the September meeting rather than in November, those households may face higher mortgage repayments for the first time this year.
If your mortgage repayments are about to rise
A missed repayment rarely causes a legal problem on its own. Problems arise when repayments are missed and nothing is said to the lender.
If you can see that a higher repayment is going to be difficult to meet, you may be entitled to ask your lender for a hardship arrangement. Consumer credit law generally requires a lender to consider such a request and to respond to it within a set time. An arrangement may take the form of reduced repayments for a period, a temporary switch to interest-only payments or an extension of the loan term. Asking is not itself a default, although you may wish to ask your lender how any arrangement will be recorded on your credit file.
If repayments are missed, a lender in Queensland cannot simply sell your home. It is generally required to give you a written notice identifying the default and allowing you at least 30 days to fix it before it may take steps to enforce the mortgage. If that period passes and the lender does sell, the law requires it to take reasonable care to obtain market value for the property, and the proceeds must be applied in a set order with any surplus returned to you. A hurried auction in a falling market is one situation in which that duty may matter a great deal. If you receive a default notice, the days that follow are the time to get advice, not after the auction has been advertised.
Many loan documents also allow the lender to demand the whole balance once you are in default. Queensland law now offers borrowers some protection against those accelerated demands, but it is not automatic and it may require you to act quickly.
Buying or selling in a softer market
CommBank’s report refers repeatedly to declining housing prices and lower property turnover as reasons for the slowdown. Both have consequences for anybody with a contract on foot.
If you are selling, the risk that stands out is a buyer who cannot complete. A buyer whose lender values the property below the contract price may be unable to raise the balance. If the contract is subject to finance, that buyer may be entitled to terminate and recover the deposit. If the finance condition has been satisfied or waived, or the contract was unconditional from the outset, as auction contracts in Queensland usually are, a buyer who fails to settle may be in breach, and you may be entitled to keep the deposit and pursue the difference if you later resell at a lower price. Which position you are in depends on the contract wording and the notices given, and a strong position is easily lost by sending the wrong letter. Since August 2025 Queensland sellers have also been required to give buyers a disclosure statement and prescribed certificates before the contract is signed, and a buyer looking for a way out in a falling market may look closely at whether that disclosure was complete.
If you are buying, the same forces work in reverse. A property you agreed to buy three months ago may now be valued by your lender at less than you agreed to pay, and the gap may have to come from your own funds. A finance condition drafted in your favour may allow you to walk away, but only if you comply with its time limits and give notice in the correct form. A valuation shortfall does not automatically release you from the contract, and once the finance date has passed the deposit may be at risk.
You also carry insurance risk earlier than most people expect. Under the standard Queensland contract, the property is usually at your risk from 5pm on the first business day after the contract date, not from settlement. You may need cover in place within a day of signing.
The insurance you may be tempted to drop
Insurance is one of the fastest-growing categories in the CommBank data, and premium increases are a real source of household pressure. One detail should give property owners pause. While almost every type of insurance recorded higher spending, landlord insurance and title insurance recorded large contractions, which suggests that some investors are letting their landlord cover lapse to save money.
Before you do that, it may be worth checking your mortgage. Most home loan contracts require the borrower to keep the property insured, and letting the policy lapse may itself be a default under the mortgage even if every repayment has been made on time. It may also leave you carrying the full cost of unpaid rent or tenant damage at the moment when tenants are under pressure themselves. If premiums are the problem, reviewing the level of cover or the excess may be a better answer than cancelling the policy.
Money pressure and separation
Financial stress and relationship breakdown often arrive together, and the CommBank data suggests that mortgage holders are feeling the pressure most. If you separate when the home is worth less than it was and the mortgage costs more, a few points may help.
The value that matters in a property settlement is generally the value at the time the settlement is worked out, not the value when you separated or when the home was bought. In a falling market, delay may shrink the pool that is available to divide. The mortgage and other debts are usually taken into account as part of that pool, and both of you may remain liable to the lender regardless of what you agree between yourselves. Stopping repayments to put pressure on a former partner tends to hurt both parties, and a court may take a dim view of it. If one of you stays in the home, it may be sensible to record who is paying what and to speak to the lender early if repayments cannot be met. There are also time limits for applying for a property settlement, generally twelve months after a divorce or two years after a de facto relationship ends, and a downturn is not a reason to let them pass.
If you run a small business
Several of the sectors that have slowed in the CommBank data are populated by small businesses. Retail spending growth is the slowest since March 2025, spending on event hire and planning fell 11.7 per cent over the year, and growth in household services, which includes trades such as electrical, plumbing and concreting contractors, slowed from 5.5 per cent to 2.7 per cent.
If your customers are slowing down, the legal issues tend to be about cash flow. Progress claims on building work may need to be made in the form the law requires, because Queensland’s payment regime for construction work gives contractors and subcontractors useful rights only if the paperwork is right. Rent on a commercial lease does not pause because turnover has fallen, and a conversation with the landlord before arrears build is usually more productive than one afterwards. Directors should also be aware that continuing to trade while a company cannot pay its debts may expose them personally, and that personal guarantees given years ago to landlords and suppliers may still be in force.
Practical steps
The common thread in all of these situations is timing. Whether the issue is a mortgage, a contract, a separation or a business, the options available to you tend to narrow as time passes, and the most useful advice is usually the advice obtained before the first missed repayment, the first missed contract date or the first unpaid invoice. If you have a property contract on foot, read the finance, insurance and default clauses again and diarise every date.
How W & G Lawyers can help
Our property, family and commercial teams regularly assist clients with lender default notices, contracts that have become difficult to complete, property settlements in a changing market and businesses under cash flow pressure. If any of these issues apply to you, we would be pleased to discuss your position.
References
- Commonwealth Bank of Australia, Global Economic & Markets Research, CommBank Household Spending Insights — August 2026 (Belinda Allen, Head of Australian Economics, and Lucinda Jerogin, Associate Economist), prepared 22 September 2026, published via the CommBank newsroom at https://www.commbank.com.au/newsroom.html and https://www.commbankresearch.com.au/
- Property Law Act 2023 (Qld), Part 7 Division 4 (seller disclosure) and Part 8 (mortgages), including ss 114, 116, 118 and 130
- National Consumer Credit Protection Act 2009 (Cth), Schedule 1 (National Credit Code), ss 72 and 88
- Family Law Act 1975 (Cth), ss 44, 79 and 90SM
- Building Industry Fairness (Security of Payment) Act 2017 (Qld)
- Corporations Act 2001 (Cth), s 588G
- REIQ / Queensland Law Society Contract for Houses and Residential Land, clause 8.1 (risk)
References
- Competition and Consumer Act 2010 (Cth), Schedule 2 (Australian Consumer Law), Part 3-2, Division 3 (lay-by agreements)
- Gripske v Maritimo Sales Australia Pty Ltd [2025] QDC 133
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This article is general information only and does not constitute legal advice under Australian law. For advice specific to your situation, please contact W & G Lawyers. For further details, please click here to view our disclaimer.