Newspaper article 1990
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Home loan rates in Qld drops to 13.4% ,the lowest in Australia
Does anyone remember when rates were 17% ,
This is an article I found proving it.
Its funny how people get used to assuming that 7.5% is 'high'.
I think its call recency bias.
With the currency printing presses running overtime world wide , is there any reason why inflation won't cause such high rates again?
Home loan rates in Qld drops to 13.4% ,the lowest in Australia
Does anyone remember when rates were 17% ,
This is an article I found proving it.
We were buying a PPOR at this time and we locked in at 13% after all we had borrowed 30K
we then watched IRs go above 17% and at the time in Perth there was a buying frenzy on.I remember my rates going from 8 to 15%, not much fun, but then I also remember what happened to house prices shortly after.
I also remember inflation in the UK running at 27% in the 70's, and how few people realised house prices were going backward as a result.
Thank God things are so much better these days.
I also remember inflation in the UK running at 27% in the 70's, and how few people realised house prices were going backward as a result.
Thank God things are so much better these days.
Interesting to see the "average home loan of $80,000" and repayments nearly $1000 pm.
average loan size in Aust approx $350,000 (most likely higher by now), this means p&i repayments at 15% would be $4,426 pm. At what point do we think spending will slow if the net average income of a person earning $60k PA is approx $3,937 prior to feeding their belly.
I know there are other factors contributing to inflation, but from this point of view I dont see rates going to this area at all, but I do see them going higher, possible to the same ratio of income to repayment as in the 90's. Rates were perhaps too low at certain points in 70's, 80's and 90's for the repayment to income ratio.
I know there are other factors contributing to inflation, but from this point of view I dont see rates going to this area at all, but I do see them going higher, possible to the same ratio of income to repayment as in the 90's. Rates were perhaps too low at certain points in 70's, 80's and 90's for the repayment to income ratio.
I remember well. Paying off PPOR, rates 17.5%, two babies AND being made redundant all at the same time.
Not something I want to repeat.I have a few old bank statements from the 1990's ,different world back then when it came to money lending,but i know a few people that split upHome loan rates in Qld drops to 13.4% ,the lowest in Australia
Does anyone remember when rates were 17% ,
This is an article I found proving it.
when they did not lock their rates in during that period ,the Avge price for inner Brisbane back then was $131,612,..willair..
Sorry I'm just a newbie but isnt the point in raising rates to mainly stop people spending? Back when rates were up around the 17% mark (way before I was born) I understand loans were only (as in my parents case) 2 or 3x the average wage. Now that they are up around 6x the average wage surely if rates hit the 10% mark it will have the same affect as back when they were at 17%????
Just seems a simple answer to me
Just seems a simple answer to me
Bang on with that assessment. There might be a slight bit of variance in the ratio's, but in short this is whats important. The larger the average mortgage by comparison to incomes, the greater that 1% increase will impact spending.
