Effect of interest rate hikes - are you feeling it?

virhlpool on 29/04/2023 - 18:03
Last edited 03/05/2023 - 18:44

Hi OzBargainers! This is a hot topic at the moment and it's hard to ignore. Whilst on one hand I see people spending money on literally everything (houses, holidays, shopping) like there's no tomorrow, on the other hand media has been making the interest rate hikes a big deal (even though RBA seems to have been much less aggressive/ decisive than the other central banks) and then there's news about layoffs (at a very small scale yet) and softening job markets. As if this isn't perplexing enough, my every visit to a shopping centre or a mall gives me a bigger shock about the price increases - 30% price hike in 3 years sounds 'mild' now when some products have almost 60%-70% higher prices and yet I don't see people at large complaining about it (or rent increases for that matter).

Things are no different on the housing front. Some economists predict price rises in the near future whilst others predict a fall. People are still very optimistic about price trajectory and don't seem to hesitate to take $1m-$2m loans even at 6% interest rate, demonstrating that a huge population, at least in the major cities, still has an ability to repay $8,000-$10,000/ month towards the home loan despite such a sharp increase in overall cost of living.

I was wondering if there is a huge number of people who have started feeling the pain (though it doesn't look like if you visit any stores) OR not yet. Whilst obviously no one has a crystal ball, it will be insightful to hear thoughts of savvy OzBargainers on the current state (and direction) of economy, inflation, property market, etc. Feel free to share your ground-level observations as well, if any. Media can be biased so a neutral voice can be often more interesting. Thanks!

P.S.: Added a poll later so there are only a few responses. Your vote is welcome!

Poll Options

  • 158
    No, I don't feel the pain. I continue to live like before and my saving/ buffer is still decent.
  • 172
    Yes, I feel the pain and my saving has shrinked but I have a large enough buffer so it's ok.
  • 63
    Yes, I feel the pain and my saving/ buffer has shrinked significantly. I'm worried.
  • 12
    Yes, I am in stress and actually struggling financially.
Financial

Comments

      • caitsith01 on 01/05/2023 - 21:48
        +2

        I also find the travel situation very hard to understand. Everything is cripplingly expensive yet everything is fully booked all the time. It reeks of profit taking, airlines and hotels and everyone else artificially limiting supply to make money from people who pay more than they used to in smaller numbers. Something definitely seems off about it.

        • virhlpool on 01/05/2023 - 23:05

          Leave alone hotels and airlines, even the shitty airbnbs which would mostly remain vacant before Covid are fully booked almost always at double the pre-Covid room rents. This is beyond anyone's understanding.

          • gromit on 02/05/2023 - 11:19

            @virhlpool: people had a lot of saved up money from holidays not taken, deferred or vouchers from Covid period. From what I heard with other countries and cruises etc it will be like this availability and price wise till at least next year. So no they aren't artificially limiting supply, it is simply the massive increase in demand that they are all struggling to handle.

            • virhlpool on 03/05/2023 - 16:01

              @gromit: I see.. then RBA will need to keep tightening up until the demand comes in the desired range for them.

    • gromit on 30/04/2023 - 22:32
      +2

      Interest rates are unlikely to go down much if any. They were insanely low, even now they are historically on the low side.

      • Nebargains on 03/05/2023 - 06:26

        Literally just guess work but the RBA have already flagged that the current cash rate is restrictive so it's likely that when inflation is back to target rates will be lower than now. I'd guess a good rate on a mortgage might be 4% (which was like it was pre Covid) instead of the 5.5% now.

        • gromit on 03/05/2023 - 07:58

          The average mortgage variable rate over the last 20 years is above 5%, selecting 20 years as if you make it 30 or 40 it is even higher. I think the likelihood of us seeing 4% again is extremely low and would mean a really series economic collapse they are trying to halt. Precovid signs were pointing to an increase. I would be shocked if we saw sub 5% again in the next decade.

  • SpicyPeanut on 29/04/2023 - 23:33

    I'm not suppose to talk about it but have you guys heard of this club where you can go and finally just be yourself and fight what really matters?

    • virhlpool on 30/04/2023 - 01:35

      Share more about it if you can take some more liberty. ;)

    • PumpkinHater on 30/04/2023 - 21:59

      What is the name of this enchanted place?

    • OzzyOzbourne on 30/04/2023 - 22:59

      Of course, everyone knows about this club

  • AustriaBargain on 30/04/2023 - 00:20
    +7

    It affects me because my wealthy friends who leveraged themselves to their ears in property always bitch about being slightly less wealthy. Their projections for having 10 million in spare cash or whatever by the time they're 50 based on property value growth, 0% interest, and rental growth is all thrown off. And if the government were to start incentivising construction of high density housing, which would increase the vacancy rate of rentals everywhere and bring rents back down to where they were when I was a kid, then their projections would be permanently ruined no matter what the interest rate was.

    I don't care what anyone says. House values could crash to 100k and it wouldn't result on people living on the street, there would still be people gladly renting them out for $100 a week. Renters don't need property investors. That's backwards, the houses would still exist and still be rented out even if every property investor died of a heart attack tomorrow. Property investors need renters.

    • virhlpool on 30/04/2023 - 01:38

      Their projections for having 10 million in spare cash or whatever by the time they're 50 based on property value growth, 0% interest, and rental growth is all thrown off.

      Why would they think so when the property prices have gone up as high as 60-70% in just 3 years in most areas of major capitals?

      • AustriaBargain on 30/04/2023 - 01:46
        +3

        Because they used the increase in value to borrow even more money to buy more property. It's a bit like a gambling addiction, the more you win the more you want to gamble and the more you have to gamble. But who knows the bubble might continue to grow and grow and they could retire millionaires while the rest of us are selling our butts just to pay rent.

    • Charmoffensive on 02/05/2023 - 10:28
      +1

      Renters don't need property investors. That's backwards

      I'm afraid you have it backwards, mate. If you want rents to lower, you flood the market with housing. If you want new houses to be built to flood the market, you need investors. Population is constantly growing, we want the housing stock to as well.

      And if the government were to start incentivising construction

      You almost get it. Who do you think they're incentivising to build? Starts with a P.

      • AustriaBargain on 02/05/2023 - 13:01

        Fine I'll add the proviso that renters don't need property investors for existing properties. I've said it a number of times here already that investment incentives should be for new builds only, but I guess it bears mentioning again.

        • Charmoffensive on 02/05/2023 - 13:34
          +1

          And I would 100% agree with you. Things like negative gearing should only ever have been extended to new builds.

  • jm7 on 30/04/2023 - 00:50
    +6

    I haven't felt it yet. Coming off 1.89% fixed rate in September 😔

    • SoTightEcoLPI on 30/04/2023 - 00:57
      +3

      Lucky you, I just negotiated my variable offset from 6.72% down to 6.14% and felt like I was winning. GG when you off fixed.

      • ATangk on 02/05/2023 - 21:05

        Better off refinancing. Theres loads of cashback offers from 3-5k and you can get rates in the 5.5%~ region, though that would be before todays rate rise. Before rate rise, unloan was doing something like 4.99%.

        • SoTightEcoLPI on 02/05/2023 - 21:13

          Not sure on my serviceability. Added two more kids since applying and now and I'm part time, wife working full time. I need offset account as well. Seems Easier to negotiate. I had an application from broker and he was suggesting to just declare one child which was very unprofessional. Application was enormous

          • ATangk on 02/05/2023 - 21:16
            +1

            @SoTightEcoLPI: The cashback is equivalent to almost 6 years of extra interest, except you’d also be getting a better rate. And all variable rate loans come with offsets.

            You should spend 15-20 mins at each bank to see if they can get you a better deal with rough numbers, won’t need to fill out more paperwork unless it looks likely. It’ll help a lot. Worse thing that could happen is them saying no.

            • SoTightEcoLPI on 02/05/2023 - 21:32
              +1

              @ATangk: Apologies, I got the loans mixed up. I'm on 5.42% reduced from 6.24% from my for my P+I with full offset and no annual fees. Interest only on rental loans reduced to 6.14% form 6.79%. This was done my relationship manager, just showed them amp offer from a broker. I am in premium banking with set relationship manager, not that I really care, but they tend to have more wiggle room to match when I attempt to leave. These rates are before today's +0.25%.

              • SoTightEcoLPI on 02/05/2023 - 21:33

                @SoTightEcoLPI: They weren't keen to match AMPs cash back. For $3k and the headache of two applications and serviceability with three kids I'm not sure how I would go.

              • ATangk on 02/05/2023 - 21:43
                +1

                @SoTightEcoLPI: Thats a good rate for negotiated. I couldnt be bothered negotiating hard as their first offer once my fixed rate ended was 6.79%, and when i did a quick check they put me at 6.19%, but as refinancing gave me an offer of 5.24% + $4k cashback, it would have been silly not to. Also pre-today's rates.

  • Bullwizz on 30/04/2023 - 10:56

    I haven't felt the pinch yet. The increase in the cost of living,including an increase in mortgage repayments, has made a dent into our monthly savings.. However, we are still comfortable to travel,dine out etc as usual.

    • virhlpool on 30/04/2023 - 10:59

      The increase in the cost of living,including an increase in mortgage repayments, has made a dent into our monthly savings..

      Awesome. I would call this a pinch of some sort though depending on the size of the dent.

      • Bullwizz on 30/04/2023 - 11:23

        Yeh i'm saving about 25% less than when the interest rates bottomed during the pandemic.

        At the time I accepted that it would come back to the current levels at some point, so this was factored in to consider at what point that ill need to make some budget/lifestyle changes. i suppose the only surprise is how quick it all played out.

        I'll start sweating if the rates go up another 2-3% though!

  • FimpBARGAIN on 30/04/2023 - 12:37
    +8

    We definitely noticed it change over the past 12 months, our balance would generally climb a little bit a month despite paying double the minimum on our mortgage.
    Then by December last year the interest on our loan was gobbling up half what we were putting in for the month.
    Figured the best way to deal with the banks was to ditch them, so we renegotiate the rate and now put in as much as we can a month.
    Just checked and 5yrs 10months left, so should be mortgage free by the time I'm 50.

    None of that is by accident, we have planned this by building careers which are in demand. Bought a cheaper first home which we renovated then sold 8yrs ago, don't keep up with the Jones' etc. But even by doing all that if we didn't take action we would have had our mortgage well into our 60's. F that!

    I get so angry at all the banks and Colesworths reporting massive profits while delivering worse and worse value for their customers. I've put up with it for decades, now I'm planning my exit.
    We have a bit of land available and im doing a small farm course next week.
    They can all kiss my arse

    • virhlpool on 30/04/2023 - 14:11
      +1

      None of that is by accident, we have planned this by building careers which are in demand. Bought a cheaper first home which we renovated then sold 8yrs ago, don't keep up with the Jones' etc. But even by doing all that if we didn't take action we would have had our mortgage well into our 60's. F that!

      Totally legit thought.. I wonder how people who are borrowing $1.5m-$2m in their 40's will cope up with repayments in their 60's! The amount of monthly repayment required may seem dreadful even now, let alone in 60's. Downsizing is the only option left then if one can't continue to repay for 30 years.

      I get so angry at all the banks and Colesworths reporting massive profits while delivering worse and worse value for their customers. I've put up with it for decades, now I'm planning my exit. We have a bit of land available and im doing a small farm course next week.

      Good on ya. True, the profits of banks, ColesWorths, and super/ insurance companies put average Aussies to shame every financial year and yet we need to continue shopping with them since there aren't many options.

      • muzzamo on 01/05/2023 - 13:57

        @virhlpool you have answered your own question.

        PPOR is ridiculously tax free - including the capital gains. Capital gains (and losses) are amplified by leverage.

        A lot of people dump as much money as they can into their PPOR because they know it will be tax free (and they assume the gains will last forever). I know someone who is in her 50s, divorced and single. Post divorce she purchased a 6 bed room house for herself.

        • virhlpool on 01/05/2023 - 18:38

          I know the gain is tax-free in case of PPOR but the amount you need to buy a property (and more importantly, service the hefty loan considering today's prices) is an after-tax income. e.g. 6% interest rate at the moment takes $60,000 of after-tax income amount in a year to service only interest component on a $1m loan. Servicing the bigger loans (and considering interest + principal amounts) for 30 years isn't for the faint-hearted.

  • Noy on 30/04/2023 - 15:41
    +2

    I do an annual rent review for the rent on my small unit that I rent out on anannual lease to a long term, great tenant who always pays the rent on time and looks after the unit. This year I need to increase the rent by $20.00 per week just to recover the cost of owning the unit with nothing extra to cover my increase living expenses. Where does it go? Increased annual council and rubbish fees, increased water charges, increased strata fees, increased insurances, increased annual electrical safety inspection fees ,increased maintenance costs for plumbers, electricians, handyman etc. So with all the charges going up, mostly government fees, its no wonder rentals in houses are going through the roof.

    For mortgages, better reduce expectations for 4 bed/ two bathroom homes as a basic home expectation to the 3 bed/1 bathroom for new housing like we had when interest rates were more around the 8% level. Oh how about the kids playing outside instead of attending numerous sporting activities, gyms, gaming charges for internet and buying games, etc. Our parents limited what we could do with one sport and an occasional trip to the movies. How about cutting down on fast foods or dining out or is that a necessity now and not a luxury?

    These days the government is expected to provide everything so no wonder the country is going broke and if how about the the greens and animal rights people trying to reduce us to all be living in caves and eating grass. Go take a look at the 22sq mtr -50 squ mtrs housing in Asian countries being built for low income earners with 30 year loans at 6.0%
    Tell the government to stop printing money and hiding it out as if there is no limit and then watch as inflation drops and wages become competitive with most other countries in the world.

    • [Deactivated] on 30/04/2023 - 21:15
      +3

      Blaming the government for 'printing money' that causes inflation is missing the forest for the trees. It's scapegoating the very people who are actually suffering from inflation.

      Pensioners and unemployed getting 3 Billion in COVID money didn't cause the current inflation, low interest rates increased the value of real estate by 1000x more - by 3 trillion in 2 years. From 7 trillion to 10 trillion. What is the first thing people do when their house price goes up? Buy new cars, build an extension, buy a holiday house - which is exactly what happened during COVID - shortage of cars, shortage of building materials, shortage of rentals especially in rural 'holiday house' towns.

      now that money has filtered through to the cost of living and we are getting calls to stop the government 'printing money' and increasing taxes - on the wealthy. We are being fed the lie that we are all the wealthy people that will be taxed.

    • surg3on on 02/05/2023 - 15:21

      Im not sure how its the poors fault for the inflation. The top 10% of Australians hold half the wealth. If inflation is too much money in the system surely we start there?

      "The richest 10% of households has an average of $6.1 million and almost half of all wealth (46%), while the lower 60% (with an average of $376,000) has just 17% of all wealth." https://apo.org.au/node/318715

  • Venustrap87 on 30/04/2023 - 16:07

    been spending alot less out and and cooking more at home.
    there is an RBA meeting tomorrow or tuesday this week it speculates that another interest rate rise is on the cards again

  • Herbse on 30/04/2023 - 20:52
    +3

    People say they've "felt it" and might have cut down in one area like groceries but also continue or increase spending in other areas like entertainment and social activities.

  • bmerigan on 30/04/2023 - 20:59

    We're not "feeling it" as far as we're still doing and buying everything the same as we always have, BUT a less certain future has made us not buy our dream caravan when it became available just so we can keep the cash reserves.

  • Unacceptable on 30/04/2023 - 21:29
    +5

    I paid up the mortgage last September and every penny I save in my saving account earns high interests.
    How ironic. And because of that I tend to spend more now.

    • robertxx74 on 30/04/2023 - 22:38

      You have to spend more because the "high" interest on a savings account is still less than the rate of inflation. If you don't spend, you're going backwards!

  • SpicyStew on 30/04/2023 - 22:12
    +3

    Earn EURO and USD and live on AUD, no worries.

    • baldur on 01/05/2023 - 21:51

      Yeah and waste the difference in flight tickets.

      • SpicyStew on 01/05/2023 - 22:02
        -1

        who mentioned living there? you only.

        work smarter.

    • Castcore on 01/05/2023 - 22:40
      +1

      How would you actually go about doing something like this?

      • MuddyClear on 03/05/2023 - 09:56

        Work for a U.S. company that allows you to work abroad

  • OzzyOzbourne on 30/04/2023 - 22:56
    +1

    Finally some interest on my savings, but more than offset by price hikes 😣

  • bkankur on 01/05/2023 - 02:45

    @virhlpool Op, can we add voting around it, interesting question.

    • virhlpool on 01/05/2023 - 23:10

      This is more of a subjective discussion. Voting options with simple words or short phrases won't make sense.. e.g. Options like — I feel the pain. I don't feel the pain. I am in stress. — won't tell much so I guess descriptive answers can be more insightful.

      • techlead on 01/05/2023 - 23:15
        +1

        You can have a poll, in conjunction with comments. You can have options like.

        Yes, I feel the pain but I have a large buffer
        Yes, I feel the pain and I'm worried
        Yes, I feel the pain and I'm very stressed about it
        No, I don't feel the pain at all I continue to spend as I did before

        Something like that.

        • virhlpool on 01/05/2023 - 23:27
          +1

          Added a poll. Hope it makes sense. Cheers.

  • Spamazon on 01/05/2023 - 05:42

    I cant afford the genuine replacement filters on my xiaomi air purifier, so I have to buy the generic ones that are half price on ebay.

    • Conformist on 01/05/2023 - 10:06

      Did you also have to opt for generic non brand spam over brand spam?

    • techlead on 01/05/2023 - 23:15

      Wow, I actually got the genuine ones for my xiaomi robot vacuum.

  • nobro25 on 01/05/2023 - 08:19

    Robert Kiyoshi - Debt is good.

    • Guerilla89 on 01/05/2023 - 14:44
      +1

      As long as it isn't inherited. It's a gamble.

    • Ghost47 on 01/05/2023 - 19:57
      +1

      Uh, it's Kiyosaki no Kiyoshi.

      IIRC he also said that houses are a liability, because they only take money out of your pocket and don't actually put money in your pocket (until it's fully paid off anyway, but really even then you have to factor in that there will be unforeseen repairs, maintenance etc. required which will still take money out of your pocket).

      • SomeGuyOnOzB on 05/05/2023 - 23:28

        Nah … Robert Kiyoshi lives down the road …

        I thought Kiyosaki said that about the property that you live in.

        He then talked about having investments, including property, that paid for themselves (rent > loan repayments and all costs).

        Though you can find similar information in many "investment seminars"

  • Slippery Otter on 01/05/2023 - 08:37
    +2

    I live with my family in a large house so I don't feel it. Unchanged except my personal growth has also unchanged. Win in 1 area but sacrifice big in another.

  • Name on 01/05/2023 - 13:11
    +2

    No. I'm actually thinking about dropping more hours at work as I don't need the money.

  • KaTst3R on 01/05/2023 - 16:08
    +1

    Is this like a Financial Support Group?

  • Unorthodox on 01/05/2023 - 16:11
    +1

    Didn't really feel it until I decided to pay off my HECs debt in full given the indexation (especially after seeing the effect last year).

    Also was looking at moving to a new state for work for a few months and the rental market nightmare put things into more perspective…

    Return to the office also means more spending on commute, food, coffee etc and I've noticed many price increases across the board. Heck I saw that lunch meal sets are looking to hit $25-30 at many restaurants.

  • admira on 01/05/2023 - 16:15
    +1

    We have cut back on groceries, buying more in Aldi, looking for specials a lot more, not eating out anywhere near as much.

  • Hangryuman on 01/05/2023 - 16:16

    getting current messages from my bank - the loans I fixed at 2.19% 2 years ago are expiring soon

    and the lowest rate I see in current offerings for me is 5.65%

    for investment fixed or variable under 'Investment home loan interest rates' in https://www.commbank.com.au/home-loans/interest-rates.html?e…

    so 5.65-2.19=3.46% more, or 3.46/2.19=158% more

    lemme try to remember - banks only offer lower fixed than variable rates when they expect rates to Fall below those fixed rates over those timeframes ?

    and when fixed rates are higher than variable rates that suggests banks expect rates to Rise above those fixed rates over those timeframes ?

    not sure - I may have it round the wrong way - anyouse ?

    • johnfuller on 01/05/2023 - 16:51

      honey moons over.. hopefully you used that time wisely and paid more of your principal

      banks take a calculated and predicted gamble sometimes when offering products on discount, same kind of gamble you take by fixing it by thinking you can outsmart them .. or perhaps hope they made a mistake ..

      i would find banks offering incentives like cash backs for moving your home loan with them or find one offering another reduced rate

      • Hearthstone on 02/05/2023 - 21:01

        bank can match fixed rate with their borrowing cost, they always make their margin they don't gamble
        they offer 3% fixed they would borrow at 2% or 2.5% fixed

        they can offer lower fixed rate because they can borrowed at a lower fixed rate.

        the cash back stuff is just fighting for market share and there is a cost to doing that short term, they just hope their new customers will stick around long enough for them to recoup back the cash back outlay

        • Hangryuman on 03/05/2023 - 11:22

          incentives like cash backs and honeymoon rates work because of short-term thinking

          humans tend to be more interested in here and now than future possibilities

          and when short of cash, any offer of 'cash back' can sound attractive

          even if it means more costs in future - that's another day

          an example of poor-people thinking - people who grew up poor can feel rich when they spend money - as they couldn't before, so spending now feels like luxury

          problem is - that money you spent, is money you no longer have.

          economist on TV was saying we can choose high interest rates or high inflation - and that high inflation is more damaging, so better high interest rates for a shorter time - believe it or nuts.

  • Brianqpr on 01/05/2023 - 16:38
    +2

    Not sure of the purpose of these threads. You always get a bunch of people saying it affects them and another bunch smugly boasting about having savings and doing well.

    The third bunch know exactly where rates are going, which is incredible as even those who set the rates got it massively wrong on that score.

  • Bullion78 on 01/05/2023 - 17:48

    Make it a poll. I prefer data rather than reading every comment here

  • hasher22 on 01/05/2023 - 18:55
    +4

    Yes, our rent went up approx 32%, couldn't find another rental around the same price prior the rise cause 4000 other people competing.

    That 32% rise, around 50% out of the rise paid for our water, gas, electricity and internet per month. So imagine 1 month of rent rise pays for 2 months worth of utilities.

    My grocery shopping habbit has changed and I only shop for good deals such as Woolies/Coles 50% off and I am now buying more Coles and Woolies brands. Nothing wrong with them just an observation.

    I'm rarely saving now, I wanted to go to Italy this year with the money I saved but I decided not to because I may need that money.

    This month, my car insurance is due at 1600, can't find any other insurer significantly cheaper.

    I just feel like I'm not doing well in life in Sydney.

    • Hangryuman on 03/05/2023 - 11:28

      'This month, my car insurance is due at 1600, can't find any other insurer significantly cheaper.
      I just feel like I'm not doing well in life in Sydney.'

      I sold my car last year and now use public transport and rent out my carspace for $50pw

      so if that's an option that could save you $'000's per year.

  • R4 on 01/05/2023 - 21:45
    +1

    Not really. Our mortgage is not big and even with all the recent interest rate rises we're not really noticing it. We're fortunate to have an above average household income and our expenses have reduced dramatically in recent years - no more school fees and children costs being the main ones. We also have no debt apart from the mortgage so a lot of our income gets saved - paying down the mortgage, putting heaps into super and buying ETFs.

    We're doing okay basically.

  • techlead on 01/05/2023 - 23:10
    +5

    I feel the inflation, I have stopped buying non-essential stuff, which is actually good for my health, so its a blessing in disguise.

    I saw this "special" at Coles for Red Rock deli chips I think 150g (used to be 200 or 175g) pack, 2 for $10. I laughed out loud and said, nope, not paying that.

  • techlead on 01/05/2023 - 23:11

    Add a poll to the post, its a better way to aggregate data.

  • fozzie on 01/05/2023 - 23:29
    +1

    Yes definitely feeling the pinch. Mostly for the groceries. My mortgage is also going up, but I really think the overall higher cost of everything it’s causing my savings to shrink. I’m trying to save by cooking less meat (due to health reasons as well). We cook more at home, again also for health reasons as trying to loose weight.

  • MrBillions on 02/05/2023 - 03:53
    +1

    In 2020/21 the government throws excessive handouts to a lot of businesses / people during covid and now they are taking it all back…

  • Black Brown Blue on 02/05/2023 - 07:34
    +2

    The real winners are
    Government, council, state government, councils, supermarket chains, real estate companies.
    Losers are middle class average person.

    Higher house prices - more stamp duty, more fees for REA, higher council bill. A buyer will need more deposit.
    High food and products prices - more GST for government, higher profit for colesworths. There has been news colesworths is not passing price increases to farmers.
    Higher rent- more rent for landlord, renter is going to stay in rental for longer than before.
    Higher interest rates- you need to pay more in loan repayment than before.

    The current generation including me is doomed. God save us.

    • virhlpool on 02/05/2023 - 07:38
      +1

      And yet, despite all this pain, one can't buy a property at a sensible price.

      The current generation including me is doomed. God save us.

      I wonder when will govt realise this.

      • umoddbro on 02/05/2023 - 15:33

        Oh they realise it alright, but they don't care. Their own interests 'no pun intended' are protected.

    • Black Brown Blue on 02/05/2023 - 07:38
      +1

      There are heaps of others things like air travel, etc.

  • johnmatrix on 02/05/2023 - 08:56
    +1

    I'm considering selling my Aston Martin DB9 that I bought cos I have brain cancer

  • Cluster on 02/05/2023 - 10:00
    +1

    Not feeling it here. Still on a 1.75% fixed mortgage.

    I am however building a savings buffer for when the mortgage snaps back above 5%.

  • payless69 on 02/05/2023 - 10:14

    I buy a BSTA bike!

  • kalithreaver on 02/05/2023 - 10:37
    +2

    We really smashed our loan the last few years so the interest rates wont affect us much this last year till we pay the loan off. The things we are really noticing is the price of everything else like food, utilities, insurance have all jumped up heaps and im now starting to second guess purchases. I think we will start doing less take away and going out as the price of that has become ridiculous.

    What i have still noticed is that there are still so many people going out shopping and eating out. Everyone seems to be complaining but not actually changing their habits.

    • Cluster on 02/05/2023 - 13:21

      Yes, restaurants are still packed. People may be complaining, but many are nowhere near doing it tough.

      A friend is a bit short on cash but doesn't hesitate going out for a $25 meal before visiting the cinema to see the latest movie. I spend approximately $3 on my meal before joining her.

      Some people can't cut back anywhere and are in real financial stress right now, but many more out there still have vast wads of spending fat to shed.

      • jorf on 02/05/2023 - 15:37
        +1

        Lots of people just haven't realised it yet. Eg. you pay for everything on your credit card and each month you're adding a couple of hundred to the balance and paying it off a bit slower. Takes a while for it to hit the limit, but once it gets there, that's when you're in trouble.

  • mr_alligator on 02/05/2023 - 14:39

    And…here comes another rate hike. Thanks Lowe!!!

    • Hearthstone on 02/05/2023 - 15:27

      and he said they aren't finished, he said more increase coming if they cant get inflation under 4%
      but Dr Lowe don't have a mortgage, maybe he need to leverage up and get a few investment properties to see the pain ordinary citizen facing

      • gromit on 02/05/2023 - 19:46
        +5

        His job is to moderate inflation and the economy not peoples mortgages. Thankfully he is doing the right thing rather pandering to calls to go soft because of people that over leveraged themselves.

        • Hearthstone on 02/05/2023 - 20:39
          +1

          it was a sarcastic remarks LOL

          • gromit on 02/05/2023 - 22:53
            +2

            @Hearthstone: My bad, so used to people whining about RBA when they are finally doing the right thing and taking no responsibility for tgeir own choices.

            • grasstown on 04/05/2023 - 19:47
              -1

              @gromit: ? “Finally doing the right thing”

              They led people to be in the position people are in. They are just doing what they always planned

              • gromit on 04/05/2023 - 23:36
                +2

                @grasstown: anybody that relied on the RBA as their source of truth for future predictions of rates deserved what they got. The banks, analysts and practically everyone else said they were wrong, besides which the RBA often says what they need to say to support where they want to be. The RBA are not there to look out for mortgage holders, their remit is the wider economy.

                • grasstown on 05/05/2023 - 06:07
                  -1

                  @gromit: deserved what they got

                  Some people aren’t as sophisticated as you. Some people are suffering as they thought they the RBA‘s words were messaged and directed to them. Never did the media say not to listen to them

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