RBA decision brings relief, disappointment to homeowners Sam and Hayley Evans

For homeowners Sam and Hayley Evans there is some relief in hearing that rates are unlikely to rise again just yet — but disappointment knowing they won’t be going down either. As things stand, the family — including one-year-old daughter Bonnie — has little left over after paying their mortgage each month. “I’m past the point of being shocked by it,” Mr Evans said. “I don’t get surprised when they go up and down anymore. “You definitely notice it right now … it feels like we don’t see a lot of savings growth, that’s what’s been affected. “But they won’t bring the rates down, and that’s what’s annoying.” Mr Evans said the difficulties people were facing in the current economy were becoming more noticeable. “Just general shops and bars are looking quieter,” he said. “It’s the only tool the RBA has, but people keep spending, so what are we supposed to do, just stop spending? Something has to break long term.” It comes as new research from Australia’s biggest financial comparison site, Canstar, shows that stressed borrowers who bought at the top of their budget just before the rate rises started in 2022 are dangerously close to breaking point. A dual-income couple earning a combined average income of $184,060, who maxed out their borrowing capacity and purchased a home in early 2022, could now be contributing approximately 43.90 per cent of their before-tax income to repayments. “With the big banks predicting no rate cuts before November at the earliest and most pessimistically May 2025, many borrowers will be living in stress for quite some time,” Canstar’s finance expert Steve Mickenbecker said. “Even then, one rate cut will only move many mortgage holders from dire stress to deep stress.” With the big four banks still forecasting the next rate move being a rate cut, a reduction of 0.25 per cent could cut current repayments on a $600,000 loan by $101 to $3984 per month. But an unexpected rise of 0.25 per cent would add another $102 and see monthly repayments on a $600,000 loan reach $4187.