Homeowners running to stand still
From: The Daily Telegraph
August 16, 2008
IT'S been five years since the Brooke family moved into their dream home in Castle Hill in Sydney's northwest.
With spacious living areas, four bedrooms and a pool, the home was perfect for a growing young family.
"It was time to upgrade to somewhere bigger with more space for the family," Nicole Brooke, 34, told The Daily Telegraph yesterday.
"We thought it would be a great house to have as a stepping stone, and after five years we'd be able to move into somewhere bigger again."
Now, after a string of hefty interest rate rises, Ms Brooke said the family had been forced to be more careful about where they spend their money.
Ms Brooke and her husband David, 37, borrowed $360,000 to buy their home. With monthly repayments of $2800 to meet, Ms Brooke said she had cut down on luxury items.
"Every time interest rates go up it means less cash for everything else," she said.
"It's just so disheartening -- you keep paying but it never feels like the money is coming off the balance of your loan."
Alyssa Pratt, of East Gosford, works part-time in a nearby hospital and owes $210,000 on the three-bedroom home she bought in 2002.
In that time she's watched her fortnightly repayments jump 33.3 per cent from $645 to $860.
"It looks like I'll have to go back to work full time," she said.
The 32-year-old single mum faces an unhappy anniversary at the end of the month. Her 12-month fixed-rate mortgage repayments are set to jump $110 a fortnight when her bank hits her with the combined effects of three successive interest rate rises in 12 months.
"From the end of August they adjust my payments for all the interest rate changes from this time last year," she said.
"They do it on the anniversary of my mortgage."