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‘We never would have bought’: Australian mortgage holders feel the pain as interest rates rise again (www.theguardian.com)

submitted 2 weeks ago by hanrahan@slrpnk.net to c/ausfinance@aussie.zone

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They have decided to sell their newly finished home and pivot to the tiny house movement due to “cost of living and lack of freedom”.

“Humans are not meant to live this way,” she says. “It’s causing a cascade of issues, health issues, a mental health crisis and the fact that so many people aren’t having kids because they simply can’t afford it.”

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[–] dgriffith@aussie.zone 2 points 2 weeks ago* (last edited 2 weeks ago) (1 children)

"We would never have bought..."

So they got large mortgages when interest rates were down near the lowest that they have ever been in this country, since Federation.

Then it's all surprised pikachu face when rates start to head back towards the long-term 5-6% average and they're suddenly paying 5K a month.

History. It's there for everyone to look at.

[–] Nath@aussie.zone 3 points 2 weeks ago (1 children)

Does anyone remember the early 90's? 17% interest rates. Imagine that on a $1,000,000 mortgage. $170k per year interest. That'd certainly be one way to bring house prices down. It'd destroy the economy and probably cause a pile of social issues as well, but yeah - it'd bring house prices down.

[–] Cypher@aussie.zone 1 points 2 weeks ago (1 children)

The banks would collapse with the number of loan defaults and would require a government bailout, it would be chaos

[–] Eyekaytee@aussie.zone 2 points 2 weeks ago

I mean they don't have to jump from 3.85% to 17%! There's some other numbers in between