Squeezed at Home, Struggling at Work: How Inflation Hits our Community
For decades, the Indian diaspora in Australia has been celebrated as one of the nation’s most vibrant economic engines. Driven by aspirations of homeownership, entrepreneurial ambition, and strong community networks, South Asian migrants across Sydney, Melbourne, Brisbane, and Perth have built thriving lives. Today, however, that foundation is being severely tested.
As Australia navigates an unrelenting period of economic turbulence, marked by persistent inflation, climbing interest rates, severe housing shortages, and record small business distress, our community finds itself caught directly in the crosshairs. The traditional aspirational milestones of the migrant experience are giving way to daily financial survival. For thousands of Indian Australian households, the dual pressures of soaring domestic costs and volatile business trading conditions have turned financial management into a high-stakes tightrope walk.
The Domestic Crunch: Mortgages Under Pressure
The Reserve Bank of Australia’s recent decision to lift the official cash rate target to 4.85%, taking interest rates to their highest levels in nearly two decades and has delivered another sharp blow to mortgage holders. For families who purchased homes during the record-low interest rate era of 2020–2021, variable rates have nearly doubled, while those rolling off fixed terms face what many describe as a financial “mortgage cliff.”
In suburban growth corridors like Melbourne’s Tarneit and Craigieburn, Sydney’s Parramatta and Blacktown, or Brisbane’s outer southern suburbs, areas home to high concentrations of young South Asian families, the average monthly mortgage repayment has surged by hundreds, and in some cases thousands, of dollars.
“When we bought our home three years ago, we budgeted carefully for rate increases, but nobody anticipated five rate hikes in a single year pushing the official cash rate to nearly 5 per cent,” says Rajesh Sharma, an IT consultant and father of two based in Western Sydney. “We’ve cut back on eating out, cancelled holidays, and delayed updating our family car. Every spare dollar goes straight to the home loan just to keep a roof over our children’s heads.”
The financial strain is not purely economic; it carries a heavy psychological burden. For migrant families, where maintaining financial security and supporting extended family locally or overseas is a cultural cornerstone, the inability to comfortably cover household expenses is generating acute anxiety.
While mortgage holders struggle to service debt, renters and newly arrived migrants are confronting an equally brutal reality. Capital city rental vacancy rates remain constrained, while median advertised rents have reached historic highs across major metro regions.
For young Indian families saving for a deposit, the dream of homeownership is rapidly slipping out of reach. Shrinking borrowing capacities, combined with persistent property price floors, mean that even dual-income households are finding it difficult to secure loan approvals.
The burden falls heaviest on international students and recent arrivals. In precinct hubs like Harris Park, Footscray, or Sunnybank Hills, reports of severe rental competition and accommodation overcrowding are increasingly common. International students, managing capped work hour regulations alongside elevated tuition fees and living costs, are forced to allocate upwards of 50 to 60 per cent of their net earnings to secure basic shared accommodation.
“Finding a rental in Melbourne right now feels almost impossible,” says Ananya Patel, a university student. “You attend an open inspection with fifty other applicants. If you don’t offer months of rent upfront or accept overcrowded sharing arrangements, you simply don’t get the room.”
If the domestic front is a struggle, the business landscape is proving equally treacherous. Indian Australian enterprise owners, spanning retail spice stores, logistics firms, medical clinics, IT consultancies, and family-run restaurants, are experiencing an unprecedented squeeze on margins.
Data from the Australian Securities and Investments Commission (ASIC) paints a sober picture: company insolvencies across Australia jumped by 19 per cent in the September quarter, with over 4,200 businesses entering external administration. The hospitality, retail trade, construction, and personal services sectors, where South Asian business ownership is strong and have been hit hardest.
Small business owners face a complex combination of headwinds:
1. Escalating Overhead Costs: Commercial rents, utility rates, freight charges, and imported wholesale costs have climbed sharply.
2. Soaring Finance Costs: Service costs on commercial loans, equipment financing, and overdraft lines have escalated alongside cash rate increases.
3. Plummeting Consumer Spend: As suburban households tighten their belts to service home loans, discretionary spending on dining out, specialized retail, and non-essential services has contracted sharply.
In Sydney’s Little India precinct in Harris Park, restaurant owners report noticeable shifts in customer habits. While weekend foot traffic remains steady, weekday dining and average basket sizes have dropped markedly.
“Our fixed costs keep rising,” explains an Indian restaurant operator in Brisbane. “Gas bills are up, imported spices cost 20 per cent more than last year, and staff wages must reflect inflation. But we cannot simply pass all those costs onto customers who are already watching every dollar. We are absorbing the loss, working 80-hour weeks ourselves, and operating on virtually zero profit margin just to stay open.”
For enterprise owners who pledged family assets or personal property to launch their businesses, the prospect of insolvency brings catastrophic personal and financial risks.
The systemic nature of the current economic environment means that household financial stress trickles down into broader community structures. Local cultural institutions, community centres, and religious bodies report an increasing demand for support services, ranging from informal food relief to mental health support.
Community leaders point out that economic pressures are also altering traditional family dynamics. Multi-generational living, long a staple of South Asian family structure, is increasingly driven by financial necessity rather than purely cultural choice, as adult children remain at home longer and elderly parents move into pool resources.
Furthermore, community sports leagues, cultural festivals, and diaspora charity drives are feeling the pinch. Sponsorships from local small businesses, which historically funded Diwali melas, cricket tournaments, and community language schools, have dropped as business owners scale back non-essential promotional budgets.
As political debates heat up in Canberra and state capitals ahead of upcoming election cycles, Indian Australian business and community leaders are calling for targeted policy action rather than relying solely on aggressive monetary policy tightropes.
While the RBA maintains that rate increases are necessary to anchor inflation expectations back toward its 2–3 per cent target band, critics argue that demand-side tightening disproportionately penalizes mortgage holders and small enterprise owners while doing little to resolve supply-side bottlenecks in housing, energy, and logistics.
“Monetary policy is a blunt instrument,” says a representative from a multicultural business council. “Hiking interest rates repeatedly hits families and small enterprise owners who are already acting responsibly. What we need from federal and state governments is structural reform and faster housing development approvals, energy cost stabilization, and targeted payroll tax relief for small businesses trying to keep staff employed.”
While structural policy shifts take time, community financial experts emphasize proactive financial management to navigate the current climate.
• Mortgage Audit & Retention Requests: Homeowners should not wait for refinancing deadlines. Contacting lenders or mortgage brokers directly to request internal retention rates can yield lower rates without the friction of a full refinancing process.
• Commercial Contract Renegotiation: Business owners are advised to audit fixed overheads immediately, communicate early with commercial landlords regarding lease terms, and explore government energy-relief programs or small business concessions.
• Accessing Community Support: Free, confidential financial counselling services tailored for multicultural communities are available nationwide through National Debt Helpline (1800 007 007) and local community legal centres.
The Indian Australian community has never been defined by passive endurance; its history is built on enterprise, adaptability, and mutual support. While the current economic environment presents one of the most challenging operating environments in a decade, the core strengths of our diaspora, strong family units, deep community networks, and an unshakeable work ethic and remain intact.
As our community navigates these turbulent waters, the message to government and policymakers is clear: resilience should not be mistaken for vulnerability. Australian Indian families and enterprise owners are doing their part to manage the crisis at home and at work; it is now time for decisive, balanced policy leadership to ensure that the dream of building a prosperous life in Australia remains achievable for all.
