Million households 'vulnerable' to rising interest rates, and their cuts could cause recession
2 years, 1 month ago

Million households 'vulnerable' to rising interest rates, and their cuts could cause recession

ABC  

Recent home buyer Lorna Zelenak is about to head overseas for a short trip, but she wouldn't be making the same plans today. Key points: AMP chief economist Shane Oliver estimates 1 million households will have to cut spending significantly Stress about the cost of living is at a 4.5-year high, according to NAB Some forecasters now expect the RBA cash rate to peak above 4 per cent "We booked this holiday last year … If you had asked me, I would have said that I have no issues going on holiday whatsoever," Ms Zelenak said. "There's a key group there, particularly people aged between 25 to 45, who have high debt levels, very high levels of gearing, who don't have a lot of assets," economist Shane Oliver told the ABC. "That's a high number — that's 10 per cent of Australian households that are actually quite vulnerable," Dr Oliver said. In its own analysis, published in October's financial stability review, the RBA estimated 15 per cent of owner-occupiers would have "negative spare cash flows" — or not enough money left over after paying their mortgages.

Stress Interest Rates Interest Survey Spending Oliver Million Cent Going Rate Rates Sydney Rba Reserve Bank Nab Million Households Dr Oliver Zelenak Ms Zelenak Trudy Petith Households Vulnerable Lorna Zelenak Ms Petith  cuts  recession  households  vulnerable  rising  oliver  going  stress  million  cent  rates  cause  ms  spending  rate  zelenak  interest  survey

History of this topic

Jim Chalmers gloats the worst of the cost-of-living crisis is over... but these bleak figures reveal why millions of Aussies are still not celebrating
1 month, 4 weeks ago

Jim Chalmers gloats the worst of the cost-of-living crisis is over... but these bleak figures reveal why millions of Aussies are still not celebrating

Daily Mail  

Treasurer Jim Chalmers says the worst of the inflation crisis is over, despite new evidence showing one in two Australians are cutting back on groceries. Among this group of unprepared borrowers, almost half or 48 per cent of them had cut back on spending for essential items, like groceries and power bills despite the federal government's $300 electricity rebates. Treasurer …

Is there a generational divide in Australia's spending habits? Here's what the data tells us
6 months, 2 weeks ago

Is there a generational divide in Australia's spending habits? Here's what the data tells us

ABC  

Are we in a baby boomer boom? An internal Reserve Bank note said the difference in consumption growth is "consistent with differences in household balance sheets" because older households benefit from higher interest rates. "So you can't blame the boomers, as so many people like to do, for perhaps demand running a little bit hotter than the Reserve Bank would …

More people are seeking help as Australia's economy slows down, RBA governor acknowledges
6 months, 3 weeks ago

More people are seeking help as Australia's economy slows down, RBA governor acknowledges

ABC  

Reserve Bank governor Michele Bullock says she is aware that more people than usual are seeking help from community organisations as Australia's economy slows down and unemployment rises. And the number of owner-occupiers with variable-rate mortgages who are in a "particularly challenging situation" is also rising, but the RBA is doing what it can to bring inflation down, re-balance the …

Economic Survey 2024: Households not in Distress
8 months ago

Economic Survey 2024: Households not in Distress

Deccan Chronicle  

New Delhi: Keeping in view the investing trend of people in the country, chief economic advisor V Anantha Nageswaran on Monday said that households are not in distress as they are investing more in financial assets and their market values are not captured in the national income data. As per the Economic Survey 2023-24, the registered investor base at NSE …

Australia's economy grew by 0.1 per cent in March quarter, with country 'teetering' on edge of recession
9 months, 3 weeks ago

Australia's economy grew by 0.1 per cent in March quarter, with country 'teetering' on edge of recession

ABC  

Australia's economy grew by 0.1 per cent over the first three months of 2024 and 1.1 per cent over the year, according to the Australian Bureau of Statistics national accounts. "For the fifth consecutive quarter, economic activity declined on a per capita basis and the 1.3 per cent decline over the past year is the largest Australia has experienced in …

The worrying graph that shows Australia is going the wrong way in building the 1.2million new homes it needs to solve the housing crisis
1 year ago

The worrying graph that shows Australia is going the wrong way in building the 1.2million new homes it needs to solve the housing crisis

Daily Mail  

A plunge in home approvals has cast severe doubt over the federal government's ambitious plan to build 1.2million homes in five years. Australia's new house approvals are slumping casting severe doubt over the federal government's promise to build 1.2milion homes in five years To meet the Albanese government's targets, 20,000 homes will need to be built every month from July …

Nearly 5m households to face even higher mortgage costs, says Bank of England
1 year, 3 months ago

Nearly 5m households to face even higher mortgage costs, says Bank of England

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy Almost five million UK homeowners …

A rising number of households on the cusp of financial stress, but RBA says banking system isn't at risk
1 year, 5 months ago

A rising number of households on the cusp of financial stress, but RBA says banking system isn't at risk

ABC  

Australian homes and businesses are vulnerable to financial stability risks as rising inflation and interest rates continue to pressure the global economy. Key points: Australia's financial system is well-placed to deal with global economic shocks The share of households falling behind on their mortgage payments has picked up a little Despite rising rates, the vast majority of households are servicing …

Have household savings reduced?
1 year, 5 months ago

Have household savings reduced?

The Hindu  

The release of the Reserve Bank of India’s Monthly Bulletin in September revealed that households’ net financial savings had fallen to 5.1% from 11.5% in 2020-21. The Finance Ministry explained that while household financial savings may be reducing, it did not imply total savings were falling, since households took advantage of low interest rates after the pandemic to invest in …

Australia's housing divide masks real interest rates pain
1 year, 6 months ago

Australia's housing divide masks real interest rates pain

ABC  

If it feels like we're in uncharted territory when it comes to keeping a roof over your head, you're right. So by splitting that line out into the different groups of people it represents, you can see that it's the increase in mortgage costs that has driven housing costs to record highs. If you only look at the typical housing …

Young renters under most strain, but full mortgage pain yet to be felt, warns CBA boss
1 year, 8 months ago

Young renters under most strain, but full mortgage pain yet to be felt, warns CBA boss

ABC  

Renters are facing more financial pressure than households with a mortgage at the moment, Commonwealth Bank chief executive Matt Comyn says. Key points: A little more than 60 per cent of the RBA's rate increases have been felt by households so far Renters are facing more financial pressure than households with mortgages There has been a small increase in customers …

1m households to face £500 a month hike in mortgage payments by 2026, Bank of England warns
1 year, 8 months ago

1m households to face £500 a month hike in mortgage payments by 2026, Bank of England warns

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Please enter a valid email address Please enter a valid email address SIGN UP I would like to be emailed about offers, events and updates from The Independent. Please try again later {{ …

Bank of England says UK banks are resilient enough to offer struggling households support
1 year, 8 months ago

Bank of England says UK banks are resilient enough to offer struggling households support

Associated Press  

LONDON — The Bank of England warned Wednesday that U.K. households are facing mounting financial difficulties from the sharp increase in interest rates but expressed hope that the country’s biggest banks are resilient enough to offer more help than they could before the global financial crisis 15 years ago. In its half-yearly financial assessment, the central bank said British households …

Millions on a 'mortgage cliff' as they roll off low-rate home loans and hit a wall of repayments
1 year, 8 months ago

Millions on a 'mortgage cliff' as they roll off low-rate home loans and hit a wall of repayments

ABC  

More than a million Australian households with home loans are facing a huge financial shock over the next year and a half. Key points: Millions of people with home loans are ending "fixed rate" periods set when interest rates were at record lows Rates have risen at the steepest rate in history in the past year Some people will need …

Cost of living crisis sparks explosion in personal debt levels of Australians to $70 billion
1 year, 9 months ago

Cost of living crisis sparks explosion in personal debt levels of Australians to $70 billion

Daily Mail  

Australians now owe more than $70bn combined as the cost of living crisis propels an explosion in personal debts, comprehensive new polling shows. With inflation running at 7 per cent, research by finance comparison website Finder has found the average Australian now has $20,238 in debts spread across consumer loans and credit cards. Finder's data showed some 10.9 million Australians …

Mortgage crisis to wipe out savings of 1.2m households as repayments set to surge
1 year, 9 months ago

Mortgage crisis to wipe out savings of 1.2m households as repayments set to surge

The Telegraph  

The mortgage crisis will wipe out the savings of 1.2m families this year and push many into insolvency, economists have warned. Fixed-rate monthly repayments will on average rise from £700 to £1,000 for two million families when their deals end, NIESR said. Meanwhile, mortgage holders on variable rates will on average see costs rise from £450 to £700. Max Mosley …

Why Australian households are divided when it comes to financial pressure, and economists are divided on the outlook
1 year, 9 months ago

Why Australian households are divided when it comes to financial pressure, and economists are divided on the outlook

ABC  

At the lunchtime rush hour, a major Sydney city shopping strip is far from deserted, with plenty of people filling the mall — but not all have shopping bags in their hands. "We've cut back, that's for sure — we had a Europe trip booked but obviously can't afford that," said another worker whose home loan repayments have jumped. A …

Australia's cost-of-living crisis is hitting young people and low-income earners hard – but boomers are doing alright
1 year, 10 months ago

Australia's cost-of-living crisis is hitting young people and low-income earners hard – but boomers are doing alright

ABC  

The thing about a crisis is that it is, by nature, wild. Again, fast forward to today, and despite one of the most aggressive interest rate tightening cycles in the Reserve Bank's history, inflationary pressures remain. It's possible it will show inflationary pressures are easing, but it's also likely there will be pockets of higher inflation – especially regarding food …

Interest rate rises have plunged 170,000 more people into mortgage stress. Here's how to navigate the financial pinch
1 year, 10 months ago

Interest rate rises have plunged 170,000 more people into mortgage stress. Here's how to navigate the financial pinch

ABC  

Financial counsellors are urging people hit by rising interest rates to seek help, with the latest increase plunging about 171,000 more home owners in Australia into mortgage stress. Anglicare's Beth Schwalbe said people struggling can get practical budget help from financial counsellors like her or by calling the national debt helpline on 1800 007 007. Vanessa Emery, a financial counsellor …

The Mortgage Trap: Help us investigate lending practices in Australia
1 year, 11 months ago

The Mortgage Trap: Help us investigate lending practices in Australia

ABC  

During the pandemic, as house prices surged, many Australians took out very large home loans while interest rates were at historic lows. We want to know whether improper lending practices have contributed to the current financial stress that borrowers are experiencing. We want to examine whether existing policies and regulations provide adequate protection for consumers, or whether they need to …

Middle-income families hit hard by inflation, interest rates could sink the economy
2 years, 1 month ago

Middle-income families hit hard by inflation, interest rates could sink the economy

ABC  

Until recently, a two-income family with a couple of children could generally get by without too much financial pressure. As interest rates rise and other cost-of-living pressures increase, middle-income households such as Ms Kazmi's are pulling back on spending, and that has big implications for the economy. “They can be comfortable families, they're not in poverty, but certainly things aren't …

The risk of Australia entering recession has just risen
2 years, 1 month ago

The risk of Australia entering recession has just risen

ABC  

There are early signs Australia's economy is buckling under the strain of inflation and cost-of-living pressures. "As regards consumer spending specifically, a sharp curtailment due to higher interest rates and weaker house prices remains the major downside risk for the economy this year." Economists predict that despite recent drops in retail sales and house prices, the Reserve Bank will likely …

Has Australia's housing boom hit the end of the road and could it take the economy down with it?
2 years, 2 months ago

Has Australia's housing boom hit the end of the road and could it take the economy down with it?

ABC  

While Argentina may have dispatched Australia to go on and win football's World Cup, there is one kicking contest where we are undisputed world leaders – that's economic can kicking. Many fixed mortgage rates were below 2 per cent, some for terms as long as four years, and the Reserve Bank governor had said repeatedly that rates were unlikely to …

A 30 per cent house price fall 'unlikely' with RBA tipped to cut interest rates in late 2023
2 years, 2 months ago

A 30 per cent house price fall 'unlikely' with RBA tipped to cut interest rates in late 2023

ABC  

It's the question that most Australians want an answer to. Signs of a weaker housing market: property listings are 'abnormally low' Economists had been predicting a 15–20 per cent fall in property prices since the Reserve Bank started increasing interest rates in May. Shane Oliver says with house prices already down by about 8 per cent from their pandemic high, …

A fork in the road for mortgage borrowers: Spend cash buffers to meet higher repayments or cut back on spending?
2 years, 3 months ago

A fork in the road for mortgage borrowers: Spend cash buffers to meet higher repayments or cut back on spending?

ABC  

Money is being re-directed away from millions of Australians' bank accounts. It's that moment when you discover the majority of the Reserve Bank's interest rate increased have now been applied to your home loan and extracted from your bank account. According to RateCity, if you factor in the entire 2.75 per cent Reserve Bank rate increases, the total extra monthly …

Why two-thirds of Australian home borrowers need to be worried as interest rates keep rising
2 years, 3 months ago

Why two-thirds of Australian home borrowers need to be worried as interest rates keep rising

Daily Mail  

Two-thirds of Australian home borrowers with a variable mortgage will be hit with more interest rates rises in coming months as ANZ predicts an 18 per cent house price plunge - but at least inflation may be easing. Two-thirds of Australia home borrowers with a variable mortgage will be hit with more interest rate rises in coming months - with …

Over 640,000 Australian households in housing stress, analysis using census data shows
2 years, 4 months ago

Over 640,000 Australian households in housing stress, analysis using census data shows

ABC  

In a caravan park on a riverbank, Lisa Carter is getting the kids settled and fed after school. Key points: More than 640,000 Australian households are in housing stress By 2041, nearly one million households are expected to be in housing stress The community housing industry wants an end to "stop-start" funding It is like any other family's afternoon routine, …

Households ‘face double whammy of soaring interest rates and sky-high inflation’
2 years, 4 months ago

Households ‘face double whammy of soaring interest rates and sky-high inflation’

The Independent  

Sign up to our free money newsletter for investment analysis and expert advice to help you build wealth Sign up to our free money email for help building your wealth Sign up to our free money email for help building your wealth SIGN UP I would like to be emailed about offers, events and updates from The Independent. Jane Tully, …

The biggest cost of living increase this year — rising interest rates — climbs again
2 years, 4 months ago

The biggest cost of living increase this year — rising interest rates — climbs again

ABC  

Many Australians struggling with soaring inflation have suffered another increase in the fastest-rising cost of living: interest rates. Calculations from RateCity show that the 2.5 percentage points of rate rises prior to on Tuesday had already added 29.4 per cent to the cost of mortgage repayments on a 25-year loan. Even before Tuesday's rate increase — and any others to …

As Reserve Bank lifts interest rates again, more households seek relief from Foodbank
2 years, 5 months ago

As Reserve Bank lifts interest rates again, more households seek relief from Foodbank

ABC  

Demand for food relief from Foodbank has increased by 15 per cent since the Reserve Bank of Australia started lifting interest rates in May. Key points: RBA's smaller-than-expected rate hike has surprised economists However, more rate rises are expected And more households are feeling severely financially strained from rising rates, rising inflation and falling real wages "Around half the people …

How does corporate Australia expect households to cope with cost of living — and why we should pay attention
2 years, 7 months ago

How does corporate Australia expect households to cope with cost of living — and why we should pay attention

ABC  

Quietly, and without too much fanfare, the Australian share market has pulled itself out of a technical correction. Some companies have already reported and from today we'll get profit updates and forward guidance from the Commonwealth Bank, Macquarie Group and Telstra — some of the country's biggest employers. Yesterday the National Australia Bank revealed the outlook for its credit quality …

Interest rate rises will see property prices fall further as maximum home loan sizes shrink
2 years, 7 months ago

Interest rate rises will see property prices fall further as maximum home loan sizes shrink

ABC  

Property prices may be dropping but that doesn't mean that wannabe home owners are suddenly celebrating. Key points: The Reserve Bank is set to hike the cash rate again today Banks are already winding back mortgage limits as interest rates and inflation rise Mortgage brokers say a 'feedback loop' is emerging in the property market Lenders are simultaneously winding back …

Can we avoid a recession? What we can learn from the Kiwis
2 years, 8 months ago

Can we avoid a recession? What we can learn from the Kiwis

ABC  

A little over three hours' flying time from Australia's east coast could lie a window into our future. ANZ's Sharon Zollner says there may be a "freak-out" among New Zealand households over rising interest rates and falling property prices. "They want to be in a position such that when there's another shock, they are going to adjust interest rates in …

As fixed mortgages end and rates rise, many risk losing their homes
2 years, 9 months ago

As fixed mortgages end and rates rise, many risk losing their homes

ABC  

Sarah Ibrahim is worried about what will happen when her fixed rate ends in January. As interest rates rise, almost 300,000 people who took large and risky home loans during the pandemic could fall into severe financial hardship or even default. "We're already seeing banks ramping up their action to enforce mortgage debts and repossess homes already against the background …

Declining Sydney property prices a forecast for the rest of Australia, experts say
2 years, 9 months ago

Declining Sydney property prices a forecast for the rest of Australia, experts say

ABC  

As interest rates rise, Sydney house prices are dropping and experts say it is a "bellwether" for what is about to happen across the rest of the country. Key points: Interest rates are driving the decline in value of Sydney properties The Reserve Bank of Australia increased the cash rate to 0.85 per cent. "If we see interest rates rise …

Australia PM defends housing pitch as election looms
2 years, 10 months ago

Australia PM defends housing pitch as election looms

Al Jazeera  

Government plans would allow first home buyers to dip into their retirement savings for a deposit. Australian Prime Minister Scott Morrison has defended his election pitch to allow first-time buyers to use part of their retirement savings to buy homes in a bid to lure younger voters as the campaign entered its final week. Spending more money on a deposit …

Borrowers should brace for a 15 per cent fall in home prices as interest rates rise, warns RBA
2 years, 11 months ago

Borrowers should brace for a 15 per cent fall in home prices as interest rates rise, warns RBA

ABC  

The Reserve Bank is warning of serious risks for those who are heavily indebted with limited savings buffers, while painting a generally upbeat picture of the resilience of Australian households as interest rates rise. Key points: Reserve Bank modelling estimates housing prices may fall 15 per cent if interest rates rise 2 percentage points The RBA says the vast majority …

Federal Budget 2022: Australia's debt to pass $1TRILLION, costing $39,495 per person
2 years, 11 months ago

Federal Budget 2022: Australia's debt to pass $1TRILLION, costing $39,495 per person

Daily Mail  

Australia's government debt is set to surpass the $1trillion mark in the coming year for the first time, with Tuesday's Budget expected to bring in even more spending to tackle the rising cost of living. Inflation is now running at 3.5 per cent, a level well above the Reserve Bank of Australia's 2 to 3 per cent target. With average …

House prices keep surging in Australia
3 years, 4 months ago

House prices keep surging in Australia

Daily Mail  

Source: CoreLogic data in median house price increases in the year to October 2021 CANBERRA: Up 29 per cent to $985,040 DARWIN: Up 17.1 per cent to $567,056 PERTH: Up 16.7 per cent to $550,044 ADELAIDE: Up 22.5 per cent to $591,558 BRISBBANE: Up 24.8 per cent to $731,392 MELBOURNE: Up 19.5 per cent to $972,659 SYDNEY: Up 30.4 per …

Home loan crackdown appears imminent as Treasurer, regulators discuss house price surge
3 years, 6 months ago

Home loan crackdown appears imminent as Treasurer, regulators discuss house price surge

ABC  

The Treasurer has given the strongest indication yet that a home loan crackdown is looming, confirming that surging house prices were a key topic of discussion at a regulators' meeting on Friday. Key points: Treasurer Josh Frydenberg says the Council of Financial Regulators discussed the recent surge in home prices last week Analysts expect the council to announce new home …

The alarming figures that could spark another property market downturn
3 years, 9 months ago

The alarming figures that could spark another property market downturn

Daily Mail  

A new set of home borrowing figures reveal an alarming trend that could spark another housing market downturn. During the March quarter of 2021, the share of borrowers with potentially dangerous debt levels climbed to 19.1 per cent, up from 17.3 per cent during the final three months of 2020. Pictured is a Strathfield auction in Sydney's inner west Major …

Australia's household wealth surged by the end of 2020 — but property owners have taken the lion's share
4 years ago

Australia's household wealth surged by the end of 2020 — but property owners have taken the lion's share

ABC  

The recession was great for some Australians. More than 900,000 people were still officially unemployed in December, and the unemployment rate was still 6.6 per cent, so how could household wealth have been hitting record levels? "The December quarter growth in household wealth was driven by rising residential property prices, reflecting record low interest rates, support through government programs such …

Fears of a debt disaster as property market runs hot and changes to safe lending laws loom
4 years ago

Fears of a debt disaster as property market runs hot and changes to safe lending laws loom

ABC  

Jacob had big dreams before the global financial crisis. The Greens said the bill was "designed to let the banks get on with writing loans as big as they possibly can, whether it's good for people or not". "The banks have reduced what they were assessing loans at — in 2018 it was closer to 8 per cent, but now …

Mortgage interest rates may soon be on the way up as the Aussie dollar falls
4 years ago

Mortgage interest rates may soon be on the way up as the Aussie dollar falls

ABC  

For many Australians, the biggest financial decision they will likely ever make is buying a home. The conclusion to all of this is that higher local inflation puts pressure on both the financial markets and the Reserve Bank to raise interest rates. Markets see a world of higher interest rates Financial market participants trade every day in real time, with …

Australian property bubble hasn't yet burst, but can house prices keep rising amid the pandemic?
4 years, 4 months ago

Australian property bubble hasn't yet burst, but can house prices keep rising amid the pandemic?

ABC  

After years of dire predictions that Australia's property bubble could burst, national house prices continue to withstand the otherwise devastating impact of the coronavirus pandemic, and once again the doomsayers have been proven wrong. It's a question I asked AMP Capital chief economist Shane Oliver, who in late March at the onset of the pandemic in Australia, had warned that …

Reserve Bank of Australia cuts interest rates to a new record low of 0.1 per cent
4 years, 4 months ago

Reserve Bank of Australia cuts interest rates to a new record low of 0.1 per cent

Daily Mail  

Borrowers with a typical $500,000 home loan are set to save $43 a month with the Reserve Bank cutting interest rates to a new record-low of 0.1 per cent. Australians with an average $500,000 home loan are set to save $43 a month with the Reserve Bank cutting interest rates to a new record-low of 0.1 per cent. Pictured are …

The Government wants to make it easier for you to get a mortgage amid the coronavirus recession — but there's a catch
4 years, 6 months ago

The Government wants to make it easier for you to get a mortgage amid the coronavirus recession — but there's a catch

ABC  

It will soon be easier for Australians to take out mortgages and refinance their home loans while small businesses will be able to access more money under Federal Government plans to change credit laws, to mitigate the effects of the COVID-19 pandemic. Key points: The Government says the current credit laws are outdated, particularly during the COVID-19 crisis The Government …

Reserve Bank of Australia says 40 per cent house price fall is 'plausible' because of COVID-19
4 years, 7 months ago

Reserve Bank of Australia says 40 per cent house price fall is 'plausible' because of COVID-19

Daily Mail  

The Reserve Bank of Australia is warning a 40 per cent fall in house prices is 'plausible' as coronavirus pushes up unemployment to 1990s levels. Scroll down for video The Reserve Bank of Australia is warning a 40 per cent fall in house prices is 'plausible' as coronavirus destroys the economy. Australia's distressed housing market Sydney: DOWN 1 per cent …

When homes earn more than jobs: How we lost control of Australian house prices and how to get it back
4 years, 7 months ago

When homes earn more than jobs: How we lost control of Australian house prices and how to get it back

ABC  

Real home prices across Australia have climbed 150 per cent since 2000, while real wages have climbed by less than a third. Long-term Australian real price index for housing and construction prices ) In contrast, we show, real Australian home prices have soared 215 per cent since 1980 and have shown few signs of reversion to long-term trends, despite brief …

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