Having a mortgage is cool. Or it must be, because the trends show that we Australians are much more in love with mortgages than we were two decades ago. Reserve Bank statistics on mortgage debts, which they only began to record in 1990, show that our thirst for mortgages has been increasing at a rapid pace. Who would’ve thought that this thing we complain about so often is actually something we can’t get enough of?
The mortgage statistics are kept both for those of us who have a home loan for the house we live in, as well as for those of us who are landlords, taking out a mortgage to pay for an investment property which we then rent out.
In terms of home-owner mortgages, the amount of money owed by Australians to banks for home loans increased from A$65 billion to A$763 billion between 1990 and 2010 – yes, we now owe twelve times more. Obviously inflation can take a little of this into account, but despite that it is still clear that Aussies are keen to try to own their own home, and in the meantime have a large debt to the bank.
The number of Australians who buy property for an investment has also increased substantially over those two decades, judging by the rising debt. Back in 1990, the total amount of home loans issued to Australians for investment purposes totalled A$10.5 billion, but nowadays that figure has increased by a factor of thirty to reach A$324 billion – a huge explosion over a period in which the average disposable income of a household has only increased by a factor of three.
In comparison to other countries, the Reserve Bank said we are now “as indebted as other countries” and that’s one reason why they don’t expect these figures to rise so dramatically in the future. Rising interest rates this year might add to this, too.
Possibly Related Posts:
- Bring Back the Haggle: 10 things you should never pay full price for
- No interest rate rise in March
- Queensland floods and mortgage payments
- Mortgage and money resolutions for 2011
- Refinance your loan or keep paying through retirement?