You know how people always ask if you want the good news first, or the bad? That seems to suggest good and bad news always come together, and this week that seems to be true again. Let’s start with the good news in Australia: unemployment figures are looking healthy.
In the recently-released statistics for October, the jobless rate actually rose from 5.8 per cent to 5.7 per cent, but because a large number of people had started looking for work again, these statistics actually mean that more people have jobs this month. There was a large growth in the number of people in part-time employment, as well as a growth of the number of people employed in full-time jobs. These figures were a big surprise for most people in the industry, who had not expected employers to start being so optimistic and putting on extra employees quite so quickly.
That’s the good news; but the bad side of that is there is now a lot more certainty that the Reserve Bank will raise rates again in December. After all, we’ve all got the jobs to pay for it!
So it doesn’t sound like there’ll be a Christmas present for mortgage holders. In fact, the media is already talking about an increase in mortgage stress. The main reasons for this are, of course, the rising interest rates and the prospect of further rises in the near future, and the fact that the stimulus packages from the government have now largely run their course and are having little further effect on the average mortgage holder. The number of Australian households who are now under mortgage stress rose by 1.4 per cent from September to October, and the number of “severely” mortgage stressed households – that means the ones who are facing mortgage foreclosures – increased quite significantly. It’s still a waiting game until December to see how much worse this might get – and who knows, maybe Santa will put a good word in and interest rates will remain on hold. You never know!
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Tags: interest rates