Analysis: The more economic stimulus the Treasurer gives, the more the RBA is likely to take away in higher interest rates that eat into the income and living standards of many voters | JennieDuke
If he extends the government’s
This might not seem like a big concern but a little bump in mortgage rates will affect some households so much that even an extra $1080 in the bank won’t offset the rise in their repayments. In Victoria, repayments at the current average variable mortgage rate are $3235 for a new loan. A 25 basis point rise would push up monthly repayments by $88 to $3323. This household would be better off keeping the lamington than without it. But should rates go up by even a small amount more, this saving would quickly disappear.
“Further cementing the lamington into place would be a trade-off ... It would be good for low to middle-income [taxpayers] but it would be a bad thing for those with a mortgage,” he said.
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