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Aussie households with $1m mortgage to reap $456 in monthly savings compared to start of the year if RBA cuts rates
Aussie households with $1m mortgage to reap $456 in monthly savings compared to start of the year if RBA cuts rates

Sky News AU

time07-07-2025

  • Business
  • Sky News AU

Aussie households with $1m mortgage to reap $456 in monthly savings compared to start of the year if RBA cuts rates

Mortgage holders across the country will save more than $450 each month compared to the beginning of the year if the Reserve Bank of Australia delivers another rate cut on Tuesday, new research has shown. The central bank is widely expected to cut the cash rate for the third time this year. Another 0.25 per cent drop in July will bring the cash rate to 3.6 per cent and put hefty savings back into household budgets. Analysis from comparison site found Australians with a $1m home loan would save an extra $150 in monthly repayments if the RBA cut rates in July. This would bring the total savings to $456 since the central bank began cutting this year. mortgage expert Debbie Hays said a third cut would deliver substantial financial relief for millions of Aussies that continue to struggle with price pressures. 'Based on conversations we've had with borrowers, it's this third rate cut — the rule of three in action — that they believe will finally bring meaningful relief to their household budgets,' Ms Hays said. 'After rate hikes in 2022 and 2023, and a sustained period of higher repayments, many are now watching closely to see if and when their lender passes on the cut in full. 'It's an additional welcome boost at a time when people are receiving their tax returns — any extra breathing room in the budget is being gratefully received right now.' While Australians with a $1m home loan will reap hefty savings each month, households with smaller mortgages can also expect solid relief. A household with a $600,000 home loan will save $273 per month compared to the beginning of the year if the RBA cuts on Tuesday, while those with an $800,000 loan will save $364. It also comes as a boon for first home buyers struggling with high borrowing needs - but a cut could also boost house prices, Ms Hays said. 'For those still waiting to enter the property market, a third rate cut could boost their borrowing capacity by up to $50,000 — depending on the lender,' she said. 'While that might open the door to an extra bedroom or a more desirable suburb, it's also a double-edged sword, as it will fuel higher property prices and increased competition from other buyers with the same boost in borrowing power.' The likely upcoming rate cut follows the RBA gradually hiking the cash rate from 0.1 per cent in May 2022 to 4.35 per cent in November 2023. Rates were held for almost a year and a half while the central bank combatted sticky post-pandemic inflation. Trimmed mean inflation - the RBA's preferred measure which examines the middle 70 per cent of price changes - dropped to 2.4 per cent for the 12 months to May. The recent quarterly inflation figures showed trimmed mean inflation fell into the RBA's 2-3 per cent target band for the first time since 2021.

Pressure rising as rents climb higher in Hobart
Pressure rising as rents climb higher in Hobart

Mercury

time01-05-2025

  • Business
  • Mercury

Pressure rising as rents climb higher in Hobart

Hobart rents are on the move — and the trend is upward. Compared to the other capital cities, Hobart recorded the second-highest quarterly growth in March rental prices, according to REA Group's Market Insight report. The data showed that median advertised rental home prices in Hobart — houses and units combined — grew 4.8 per cent over the March quarter to reach $550 per week. This was miles ahead of the combined capital city growth figure, 1.6 per cent, and just behind market-leading Darwin at 5 per cent. Despite the increase, Hobart remains the least expensive capital city to rent in. Research by REA Group senior economist Anne Flaherty found that the speed of rental growth has accelerated in the first three months of 2025, reversing the trend of slowing growth seen late last year. MORE: Kylie Kwong's brother's Tassie paradise up for auction Hone your backhand at home: Landmark to fetch top dollar Just three properties': Aus rental crisis hits new breaking point Ms Flaherty said unit rents in Hobart increased by 2.1 per cent over the March quarter to $490 per week, while house rents were up 4.5 per cent over the same period to sit at $585 per week. She said regional Tasmania's rental prices lifted just 1.1 per cent over the quarter, yet remain 4.7 per cent above March 2024 levels at $450 per week. Unit rent growth in regional Tasmania held flat over the March quarter sitting at $400 a week, while house rents grew 2.2 per cent over the same period to reach $460 per week, the economist said. 'Looking ahead, the more modest pace of rent growth seen over the past 12 months is expected to continue throughout the rest of this year,' Ms Flaherty said. Meanwhile, separate research shows that rent hikes are outpacing inflation. New figures from reveal national rents have surged more than 14 per cent over the past two years, with further increases expected. The last time rents grew this steeply was during the global financial crisis, but this time the pressures are even more complex — record migration, ultra-low vacancy rates and a shortfall in housing supply are fuelling a surge that's catching millions in its wake. The website's property expert, Mansour Soltani, said renters were now facing a very different economic reality to mortgage holders. 'Inflation is easing and the RBA is moving closer to rate cuts, but renters are being left behind,' Mr Soltani said. 'There's a growing divide between homeowners who are set to see some relief, and renters who are still copping steep price increases.' MORE: Historic Salamanca building seeks multimillion-dollar sale Right by the river, one of Hobart's finest homes for sale analysis shows rents rising 7.3 per cent in 2023 and a further 6.4 per cent in 2024 — far outpacing the overall CPI rate of 6.6 per cent. If current conditions persist, rents could jump another 18 per cent by 2030. Last month, a REA Group report into rental affordability put a spotlight on the struggles faced by Tasmanians. It found that a typical household income allowed people to rent only one in five properties listed on Tasmania was named the third-least affordable state for renters. Angus Moore, REA Group's executive manager of economics, said the challenge is even tougher for those in lower income brackets, with the report finding just 1 per cent of homes would be affordable. 'It highlights the importance of Commonwealth Rent Assistance support for lower-income renters,' he said.

Savings question exposes young Aussie - as new data reveals how much YOU should be earning: 'How's she so broke?'
Savings question exposes young Aussie - as new data reveals how much YOU should be earning: 'How's she so broke?'

Daily Mail​

time28-04-2025

  • Business
  • Daily Mail​

Savings question exposes young Aussie - as new data reveals how much YOU should be earning: 'How's she so broke?'

A young Australian woman has shared her struggles with saving money amid the ongoing cost of living crisis. The 21-year-old told a street interviewer that she works as a receptionist but hasn't been able to save any money - with 'probably about five dollars' in savings. 'As long as you work, you can kind of maintain, but it's just very expensive at the moment,' she said. 'Not saving earlier would be my biggest regret.' After watching the video, one viewer asked bluntly, 'How's she so broke?'. Another viewer responded and explained that receptionists often earn very little at the beginning of their careers. The woman did not reveal her exact wage, but the average salary for a receptionist is about $65,000 per year. Australians between 18 and 24 years of age have an average savings balance of $13,069, according to Westpac data from January. The median balance, however, is just $2,410, meaning the average has likely been skewed by a small percentage of large savings holders. data showed Australian households were struggling to save much money at all. The household savings ratio indicated savings had fallen from 24.1 per cent in June 2020 to 0.6 per cent in June 2024. Adding to the pressure, Daily Mail Australia recently reported that earning $100,000 a year - a salary still out of reach for many young workers such as receptionists - is no longer considered 'good' in the face of rising living costs. The average, full-time salary stood at $102,742 in November, new Australian Bureau of Statistics data revealed in February. In the latest data, mining engineers had the highest average, full-time salary of $161,808. Retail workers typically make $77,802, while hospitality workers are the lowest paid on $74,391. Average pay levels for full-time workers is now above $100,000 in almost half all of industries, with six figures now typical in eight out of 17 sectors. Mining ($161,808), telecommunications and media ($130,390), electricity, gas and waste ($122,314), professional, scientific and technical services ($120,630), finance and insurance ($119,090), public administration and safety covering government employees ($107,557), education and training ($107,442) and health and social assistance ($100,890) made the six-figure cut.

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