Today’s homeowners less burdened by debt
“The RBA’s official cash rate in August 2016 of 1.5 per cent is only one quarter of the 6 per cent rate in August 2006 and an even smaller fraction of the 7 per cent cash rate of August, 1996.”
Cairns Post reader Sarah Cummings remembers the days of skyrocketing rates.
“We suffered on 17.5 per cent rates years ago and managed on one wage and one child,” she wrote on the Cairns Post Facebook page this week.
Taking out a loan of 80 per cent of the cost of the average house in 1991 meant a mortgage of $96,000 at an interest rate of 18 per cent.
The annual interest expense would have been j ust over $17,000.
Today, the annual interest
We bought and love the low interest rates.
There are cheap houses out there, especially if it’s your first home. You don’t have to pay a high price.
We have had to go outside of Cairns to buy, far too expensive. It’s the repayments that scared us away! cost on the average house, borrowing 80 per cent of the cost at 3.85 per cent, comes in at just over $15,000.
The HIA data found that de-
We moved to and bought a place in Cairns because it’s way cheaper than Perth. The house we bought was last sold for $80k ... in 2003! It is well above that now! But there are still bargains out there, we stuck to a budget we were comfortable with. High prices are a huge put off. spite recent price gains, the mortgage repayment burden is lower than its 15-year average across the majority of Australian cities, except Sydney.
Cairns resident Rhonda Doyle said she moved to Cairns from Western Australia for more affordable housing, while local Jade O’Reilly said she is making the most of low interest rates to pay off her property.
“We bought a four-bedroom house for under 300,000 three years ago. Bargain. Cheap houses are out there,” Ms Doyle wrote.
Ms O’Reilly said she and her husband purchased their first home two years ago.
“We purchased within our means,” Ms O’Reilly said.
“Low interest rates have been amazing for us, we’ve thrown every cent we have onto our mortgage and will have it paid off exactly three years to the day of when we bought it.”
KICKER HERE: Record-low interest rates mean it’s easier to pay off a home today compared to 25 years ago.