Now, this is going to be a tricky one, as these topics always push a few buttons. Remember, what I’m saying is just from personal experience and observation. What I have to say doesn’t suit everyone but, if my comments promote some thought and discussion, I’m happy.
Firstly, the ratio between mortgage/home loan repayments against incomes is still virtually the same as it’s always been. Many people are shocked when I state this but you can easily verify this through places like the bureau of statistics.
I still have many people who don’t believe me but I’m okay with that.
If you look back, even just one generation, people had a home loan and pretty much no other debt or commitments.
No Car/Boat/Bike/Holiday loans, No credit cards, No Internet or Mobile bills, No interest Free Offers, etc. To me it is clearly these items that put vast pressure on people’s incomes, not Mortgage payments.
Perhaps it is an indication of priorities. I’m not passing judgement, just voicing my opinion on the subject.
It is quite shocking how the Home Loan will be the first to suffer to allow other luxuries to remain, instead of maybe selling something, cancelling a gym membership, or some other simpler way of reducing the monthly bills.
In the end each individual has their own path to walk and their own importance on certain things in their life. I guess from this blog I’m just trying to highlight how things are changing from one generation to the next and that maybe we all need to review what’s important.
What can be done? I hear you ask… Maybe it’s as simple as consolidating some debts, renegotiating a loan or some changes in your lifestyle. The main thing is to do something immediately and not wait until it’s too late. If you’re honest with yourself, you’ll know long before the bank if you’re in some difficulty. Put your hand up, ask for help, whether it’s me or someone like me, a financial planner, an accountant or similar. Please ask.
If you’re loaded you won’t be reading this anyway, but hopefully, maybe it reaches a few who are in some financial stress and maybe we can see what we can do to help.