The Commonwealth Bank’s June Household Spending Index shows a decline for renters.

Banking giant Commonwealth Bank is warning of a growing divide in Australia between renters and homeowners.

The bank’s latest household spending report indicates that Australians without homeownership are cutting back on expenses, while mortgage holders and outright owners are increasing their spending.

According to the report, spending by renters has decreased by 0.9 percent in the year to June, whereas spending by mortgage holders has risen by 1.5 percent. Australians who own their homes outright have increased their spending by 2.1 percent over the same period.

“If you look at spending by homeownership status, the report highlights the challenges renters face,” Commonwealth Bank chief economist Stephen Halmarick told NewsWire. “Their spending is significantly weaker than that of mortgage holders or outright owners.

“For renters, especially younger cohorts, income is not rising as fast as housing costs. They are really having to pull back on their spending to make ends meet.”