Backing onto this, some comments made by RBA Governor Dr. Phillip Lowe at the start of the month, are a kick to the guts of home loan customers across Australia who are carrying the weight of inflation correction in our economy.
Dr. Lowe stated, “If people can cut back spending, or in some cases find additional hours of work, that would put them back into a positive cash flow position”. It’s a little odd to suggest finding additional working hours to increase cash flow, as an alternative to cutting back spending, when increased cash flow ultimately leads to more spending!…
Dr. Lowe even suggested “you don’t have that home office; you get a flatmate”. It would be nice to see Dr. Lowe rent out a few rooms in his now mortgage free home, given his prior loan against the property was provided by the RBA at a reduced interest rate, that is, his home loan was heavily subsidised by the Australian taxpayer!
Whilst we’d like to see Dr. Lowe put in a few additional hours of work to find a better pathway to inflation correction, it’s obviously not something we can control. What we can control is the review of your lending and comparing that with the best available offers on the market. Us Mortgage Brokers are also home loan customers; we get your pain, and we want to help where we can.
Now we nervously await the Reserve Bank’s upcoming Cash Rate decision on Tuesday the 4th of July, hoping for a pause.
