This is the by far the most honest assessment of what's going on in the housing market today with new borrowers. Young people, listen to Mark's advice. Sometimes it's better to cut your loses and not lose your relationships and health over a house if the level of debt gets out of hand.
I agree, if you're already struggling it seems that cutting your losses early might land you in a position to recoup some of your deposit. Leave it another 4 or 5 months of being embarrassed and struggling and you could even end up with negative equity and owing the bank even after foreclosure. It sounds like if someone isn't sure they should talk to Mark and his brokers, at least they'd be able to tell you if your situation is unsustainable. A lot of us younger folks weren't really old enough (or maybe even born yet) to really understand the savings and loan crisis. It feels like untested waters. It made me feel a lot better to hear Mark explain this stuff from a position of understanding and compassion. I hope we all make it through and that as many of us as possible can keep our homes, and keep our family together and thriving.
Inflation was rising in mid 2020 due to Over stimulus and silly low rates (trap), yet the RBA hid the fact and kept saying it's under our threshold , When they couldn't hide it they said don't worry it's only Transitory
i remember the recession in the 90's... I had just become a tradesman's plumber... my boss died of Leukaemia ..I tried working for other guys but no one was building houses... I got a job on the docks of a trucking company.... drove trucks for 20 years after that...I now run my own small biz as a gardener... strange how things and life plays out sometimes
@@sidecarmisanthrope5927 Hahahaha! Wow! Aren't you just the kind arsehole one would want for a consoling friend in a crisis! 😂 I'll bet you're terribly missed when you breath your last fella!
@ Mark Bouris Your story is exactly the same as mine. I had a business back in the 80s, that was making $10,000 a week, clear profit. However, I had my banking with Pyramid building society. They went bust, so I lost my cash, but worse than that, there was no work to be found in my industry after they crashed. So I lost my house. I had 4 kids at the time, and lost everything. Today. I'm 63 and have 5 kids, 8 grandkids and 1 more on the way. Got married for the second time, 15 years ago, and have just managed to save enough to buy a home. My first home since I lost everything back in 1990. And we had to put down 20% deposit, so we have nothing left in the bank. Things are look grim again. I wonder was I always doomed to never own a home? I had a heart attack a few years ago and I don't know how I'm going to earn enough to pay off the mortgage now. I have no super because I always worked for myself. So it's a bit of a pickle. But we will continue to hold our heads high and push on.
Thanks for the message Mark. In the 90s I remember my father was pretty stressed and we weren't allowed to use the lights or have the TV on for a few months. Dinner was literally frozen veggies and a chicken. There were three of us kids. One car for a family of five. That's how bad it got. We kept the house but my parents only told me later how close they were to losing it all. I see everyone with their 50k SUVs and think maybe you just have to live a little more simply to get through this.
@STEPHANiE I'm just not seeing that. People seem to still be spending. If that's the case then I would suggest cancelling Netflix, not buying the latest apple phone, ditching the Ford ranger for something practical and buying food instead of booze and cigarettes. What happened to all the handouts from the last two years???
@@cthorno2991 A lot of people in Australia are well off due to property deals. Everyone who owns a house in a capitol city is a millionaire. That stuff about inflation and higher prices hurting Aussies is to a large extend BS. Many well off Australians vote hard left green because they can afford the expensive green policies of those parties. Rich, green and virtue signalling. That sums up a large part of Australians.
@@jackmorgan1677 Owning a house outright with a suitable income would make most comfortable and homeownership has been the method most people use to get ahead but the interest rate rises (to something more normal) don't affect all Aussies the same way, some are close to the edge with little to no savings as a buffer. 1/3 of Aussies rent, (rents in capital cities have been rising sharply) 1/3 are buying their house, and a 1/3 own their house outright. A percentage of those in the first two groups could be in trouble due to interest rates leading to high rents/high mortgage payments, particularly those who purchased in the last couple of years or who borrowed to the limit. As interest rates go higher and property prices reduce, perhaps leading to negative equity issues, more in these categories could find themselves in trouble. But those who own their house outright or have small mortgages, don't care as much about interest rates & house price moves, higher interest rates to them may just mean a better return on their savings. I do agree that many who vocally support green policies are often not affected or barely affected by the costs and outcomes of the policies they support, nor despite their claims of virtue, do they care about the effect those policies and costs have on others.
There's a saying in the finance industry for times like this. If you have to panic, panic first. The last ppl to sell in a market downturn will get burned the hardest. If you think you can survive, run scenarios to see if you can still hold on if your missus loses her job, or your car shits itself, or your bonus doesn't come in. Plan for the worst case scenario and pump as much money into your offset as contingency.
The trouble is most people thought the good times would go on for ever. I spoke to people who had this mentality, most of them just laughed at me when I would tell about the 90s. These ones will hopefully learn a lesson from this and move on and ahead in there life.
I went thru the time Mark refers to. I’ve been telling my kids for to do their sums on 8%. Historically low rates means they only had one way to go. I think these are uncharted waters for first home buyers.
@@liamgross7217 Not just historically low, but there was a lot of political pressure to keep them low. They should not have been that low. When people talk about "market failures" it's almost always because of "market interference" by politicians.
@@liamgross7217 I'm a recent first time home buyer, but I had a large deposit for my first house that I saved myself. Once I bought my place I did the basics, new paint, carpets etc to make it much nicer. Beyond that I've diverted all my cash into the offset and living well under our means because I could see the lower interest rates weren't going to last forever. Suffice to say I'm reaping the benefits now and not stressed because I went through my scenarios and prioritised financial security above all.
@@turbostyler amazing what comments TH-cam delete. You seem to have made very wise decisions which are what is needed now more than ever. Best wishes 👍
As a highschooler in the early 90's I saw the pain this caused & realised how unfortunate it was that so many were so deeply emotionally invested & narrowly financially invested in a building. Your happiness doesn't come from a wooden box that sits out in the weather & slowly rots.
Love your inspiration. Lost 2 jobs over the last 2 years. Also went thru the flood . Survived on an oil rag and I am going to keep on , learnt to take help where I could and look forward to continuing to help others where I can 🙏. Keep up your great work 🧘♀️
Probably the best and most honest advice I have heard. No click bait title with someone’s stupid head and trying to cause fear and panic. Great sensible content
40% of my wage goes into the house I live in. Too bad it's owned by someone else. Still, absolutely fantastic advice. We need to see more Mark Bouris advice on TV.
the sad part is the guy your paying rent too likely owns the house so rising rates are not effecting them its just making high money from renters that have nowhere to go.
Rent is all you have to worry about, it's easier! The person with the Mortgage has to pay the Bank, Mortgage Insurance, House Insurance, Rates, Maintenance etc. etc. So, you see the real cost to them! Keep Renting!
The main ingredients for a strong foundation in life - Honesty and Happiness. Every single person can control their Honesty . You just restored a little faith Mark . Thanks and well said .
Great message, Mark! Not gonna lie though, I do feel a real element of personal responsibly should be on all those who've taken out a heavy mortgage. I am one of those, and my fixed rate's coming up in about 6 weeks. I purchased in 2017- but a shitty little 2 bed unit with good bones with repayments being about 1/4 of my salary. Because I KNEW that was all I could afford, and it's only my 1st home. You do not go out & buy a in a fancy new estate with no work to do on it as your 1st home. Do do the grandparent thing, buy the shitty fixer upper like I have & put sweat equity into it!
Correct, buy a RUN DOWN HOUSE and fix it , Thats how the europeans did it when they came to Australia in the 70s/80s.Now they are self made Millionaires.
@@Mazza666 If you can keep you property don't sell its not right time move out find cheap rental collect rent and top up your repayments. They're doing this deliberately satanists be smarter than they are They're greedy monsters. God is helping those who can help them selves God bless all good people will be okay 👍 👌
@@andhewonders Only if you're confident the housing market is going to be rising for a long time. Otherwise you'll end up losing a lot of money if forced to sell at a loss. There were a lot of people who bought the best they could afford who ended up losing bigtime when the interest rates hit 17%. The ones who were in cheaper properties could ride it out easier and were much better placed once the recession ended.
@@carmenandthedevil2804 : You don't know what the word "assumption" means. There are good reasons why banks and home lenders refuse to lend to certain people. And it is not because they don't like your hairstyle.
I was pumping in more then 55% back then into my house, i didn’t sell I lived with my sister and rented my place out for 3 years the money went into paying off the mortgage I later on sold and lived in my apartment that I now own also used to rent out. Best advice is to not panic we sold all our cars and I rode a 250 cc motorcycle and wife at the time caught the bus. Didn’t go out anywhere and saved everything.
@@janeblogs324 I went to a financial planner who actually gave me good advice on how to solve my problems. The irony being that it cost more to live in your place than rent. You can claim a percentage of things.
I bought my home in the early 90's on a fixed 30 year mortgage of 4.5%. The taxes and insurance are more of the payment than the principal and interest. My biggest fear however, is another shutdown without pay. I could have easily lost everything if not for having some savings which are now depleted. Any worries I might have are caused by the Government in one way or the other. No one is safe from Government.
@@martinXY Yes, I'm a Yank. I wasn't aware that you didn't have those available. They can be a good thing to get into a home for first time buyers, but the long terms of 15 and 30 years can really add up in interest even at a low interest rate. I remember now that my initial interest rate was a bit higher than what I stated, but not much. What hurt me was refinancing for the lower rate, and optioning for another 30 years to get my monthly payment down. I've learned from my mistakes but too late. Should have bitten the bullet, gone for 15 years and left it alone, except for adding extra to the principle as often as possible.
@@martinXY No, I've started paying extra on the principle each month and am hoping to pay off in 10-12 years now. Covid situation nearly wiped me out, so everything is much harder financially now. I'm handling it, though. Thanks.
I may have missed something here, but there is no way there are taxes and insurance that come anywhere near the interest on my mortgage. Different country, different system?
It's just four walls and a roof. There are thousands of them within 10 minutes of yours. You'll survive. As my father once told me... "First one up is the best one dressed". Stay strong. Love your family members. You're all they have too.
Kerry Packer would’ve made a great prime minister and run this country as a business and not sold it off slowly. Maybe you should consider starting your own party Mark and turning us around like Norway. Owning all our own resources would be a great start. Thanks for your advice mate.
Thank you Mark - I have been renting for 14 years and am being kicked out of the rental property. I am moving into a smaller place that is more expensive but thank you for your encouragement and empathy.
I’ve legitimately always liked this guy. Don’t know him from Adam but just always came across as someone who wants to help at the same time being a business guru.
Good genuine video, thanks mate. It reminded me of when I declared bankruptcy many years ago. It was humiliating, depressing, & much more. A friend gave me the best advice I could ever have dreamed of, ... he said "in business, bankruptcy is just a right of passage". That fleeting comment carried me further than anyone will ever know.
Increase your income. Make sacrifices of your leisure time converted into work time. Decrease your spending. You'll be surprised what you can live on. I've had one mortgage after the other for 40 years. No holidays, I rewarded myself eating out or buying a good steak now and then. I bought groceries I needed rather than wanted. Or bought "on specia"l items. Take a walk or cycle rather than drive saving fuel and running costs. Buying clothes from second hand stores etc. Draw up a budget. Look at it weekly to find more cost saving measures. I'm a dumb arse, but I listened to older people who had already been through tough times.
I already do alot you mentioned. I don't own a credit card, I rarely buy takeaways, I always take my lunch to work and I cut my own hair. I don't have fake nails, botox, labeled clothes but, I do have 2 dogs. Why should my interest rate go up, up, up, when I am only trying to save.
@Gee Bee that's great. You're ahead of the game. Optimism has been on a high for 20 years, and yes, the banks have become rich. We were sold a lie by the reserve bank. To keep us optimistic. However, if we can hold on until things turn around in the next upward cycle, we can become rich too. Tightening the belt will get many people through. One other thing no one will tell you is that you have negotiating power if you have a mortgage. My last one was 450,000. As the reserve raised rates, the bank did too. Each time, I rang the bank, Commonwealth 13 number, and asked for a review of my conditions. Four times in 5 years, they agreed to a discount of the rate rise. The first answer will be the standard, sorry no. Tell them you will refinance, they will tell you it will cost you money. Tell them it's worth it. They will bend. Stay optimistic and confident.
@@geebee1983 Sounds miserable have you looked at increasing your income all that above comment talked about was cutting things out, not once did they mention increasing their income. Life is to be lived not about cutting every single thing out
@ifnottoday The problem isn't a roof over their heads. It's the conditioning to get everything you want in a house, car boat etc. My first house was 100m2 fibro dump that no one else wanted. I renovated it because everyone else was. I've never renovated a house since and made money out of each of them. Things don't make us happy. Good relationships do. Contentment... There are over 11,000 houses for sale in Queensland, Australia, under $350,000, and people say, "Oh, I wouldn't live there." I never bought a property I couldn't afford if interest rates climbed to double what they were at the time of purchase. I also negotiated a better deal than the bank was offering on paper. Nobody gets everything in life, not even the rich.
I wish I paid 40% of my income to OWN the house I live in. I'm renting and it costs me 50% of my income to exist in this house. Not to mention the money I have to spend to maintain the yards etc. The rich whine about losing a bit of money, while the poor lose everything, including the will to go on sometimes.
They were handing out money hand over fist in the 80's.....until '89 when the recession hit and banks became real estate agents. Within the space of eighteen months; My partner bought a commercial property for $1.125mil......valued at $2mil not long after.....Banks took possession and sold it for 475K
Bang On! History repeating! Good on you Mark.. Your heart felt message and honesty is something everyone needs to hear....especially those who have not lived it before.
This is like a talk from your successful uncle who has the wisdom and experience to share his knowledge and give you guidance. This conversation, in that way, felt kind of intimate and genuine. You are a stand up bloke Mark.
Good on you Mark. At this stage my wife and I are ok but you have given us the best advice of what is about to happen. You are a good man. I hope more people watch this video. Thank you
Great wisdom! I learned my lesson in 2010. I was able to keep my house, but, it was a rough time. I will never take a loan out again. All the best. Jim from Georgia/ US
Finally a voice that mirrored my thoughts. As a single parent I've fast tracked my mortgage payments as much as possible last couple of years, preparing for a rainy day, and now the interest rates can't take the home away from me and my kids anymore. That is a good feeling.
Happened to me in 2009-2010 , got a house but then lost my job twice , had to sell , good life lesson , got a house again in 2014 , have put all my spare cash on it , it’s bloody hard but can be done , thanks Mark
RBA …making 30% of the adult population pay through the nose to control the spending of the rest of the population….It worked 30 years ago when most had a mortgage, today it’s different…..great vid Mark.
I was in the same boat in the late 80’s as well….my interest rate was 17.5% from memory and trying to pay off a mortgage on around $400/week. I had to get out in the end….and rented for the next 8 years. Just a tad gunshy of the Government and the banks. For me the best thing we have done is go hard on our mortgage by sacrificing paying into other non essentials. That mortgage no longer exists as a result. Wiped it out in 20 years instead of 30 with a revolving line of credit, a 55 day interest free debit card and budgeting discipline.
Forget the luxurious lifestyle of Uber eats and eating out. Upgrading the car every 3-4 years, sporting the latest handbags and watches. These are the key culprits to killing off getting ahead. Everywhere I look it's all new cars and lineups for luxury shops. Not to mention Uber eats cyclists peddling everywhere.
Haha, right? I just have a hoopty 2010 Barina I bought in cash in 2015, still gets me from a to b. I don't give 2 shits what people think, I ain't in debt (other than the mortgage!)
I think in this modern age, if you sell your house, you'll never get back in because the cost of housing is through the roof and continues to rise, and trying to save another deposit for an over inflated market to begin with will keep most of those people well and truly out. Our Govts have really screwed us this time. They have demonstrated year after year that they are totally inept at running an economy. I'm lucky I purchased when I did, because there's no way in hell I could afford a 750K + mortgage today. What do you get for $750K these days ? A mouldy old fibro shit box. The lucky country ??? It is absolutely disgusting how we have descended into this nightmare and the rich ivory tower wankers of this society couldn't give a hoot. The old saying goes. "I'm all right thanks Jack"
# Respect Mark... I myself, very much remember the economic pain in the 80's. The only thing that saved us during those 80's/90's ever-increasing mortgage rates, was that our home loan was locked in at 13%. But unfortunately, I'm to this day, still very angry! To those out there, that are going through this sh@t show... I know and feel your pain, and I hope in time (unlike me) you can let go the anger.✊
Having lived through and paid the mentally and physically debilitating mortgage variable interest rates of the 80's starting at 8% and rising to 17%, I am in complete agreement with all Mark has said. During these times it seemed that multiple 'Home for Sale' sign were erected in my street every week over an extended period. Fortunately, I was able to retain my home, but it did come at a life changing cost that was much more precious than money.
Good advice Mark, my wife and I went through the late 80’s struggling to pay our mortgage especially when it hit 18%, we stayed together,She working a second job and me fortunately able to get more overtime and doing odd jobs, I can see these increasing interest rates paralleling the times back in the 80’s.
To all young people , I know it is a struggle and it is hard , but in 30 years time when you look back you will realise how cheap your house was to buy. Better to struggle young than old for home ownership.
My partner & I are so lucky we swapped from variable to split when rates were at 1.99%. We now have about 20% variable, which is 100% offset and 80% fixed at 1.99% until 2025. I feel for so many people that were not fortunate enough to be able to do a similar thing. I Hope Mark can help anyone who needs it.
I would estimate the bank has stolen about 20k off me lately thru close to zero interest rates. Why don't seniors who slogged to put some money in the bank get any sympathy for how tough it was to pay the bills with no interest?
I was the same. Mortgage 17% and working hard. Today, no debt. 🎉🥳 Folks..get rid of as much debt as you can and tighten your belt NOW. That also means minimising your expenses. Take the pain now before it gets worse.
Another thing you could do is cut your subscriptions, stop eating out, make birthday gifts max $50-$100 and learn to suffer with less... learn to be uncomfortable so when hard times come, you are resilient because you know how to survive. Embrace the pain and be proud when you come out of this phase and always think of the steps you need to take to ensure you are not in this place again.
Watched my parents go threw that in the 90's ....I learnt a lesson .....We bought a house out in the bush b4 anyone wanted to live in the bush ...paid 130k 8 yrs ago ...friends though we were crazy .....We own our home now ....I could care less for the interest rate ....Good luck
Thanks so much Mark for offering help to many who will desperately need it, a great reminder that you can come back even after the terrible experience of losing your home. Why should families with mortgages have to bear the brunt of the cost of reducing inflation anyway? Higher interest rates are just another type of inflation shifting the problem onto people trying to buy a home for their families. It’s about time the govt stops hiding behind the Reserve Bank and stands up with sharper policies to reduce inflation and spread the pain across the whole community - including reduce govt fiscal spending in the short term, and actually doing something to address the real problem (supply) and encourage new sources of supply by encouraging and assisting business in the long term.
We were so fortunate, just as the long period of low mortgage rates was coming to an end, my old fixed rate expired and I got a new one. My advisor said go for a Three year at 1.35%….but I thought no, I can almost smell the end of cheap rates…so I went for 1.7% fixed for Five years. That was great because that slightly cheaper rate at the end of just three years would rocket to like five percent…My new rate keeps us in low outlay for five years during which I will aim to knock it down a fair bit.
With respect, this is nothing like before. You talked about relative income but what about the actual asset price lol. Houses now are 10-14x wages, and the asset itself is likely to be $1m+ and a deposit higher than the outright price of a house in the 80's if not 90's. It's a tougher market now, by far, we'll see what happens.
Bigger problem is there no houses to rent or they have astronomical Rent prices, thats why we trying to hang on, I'm over the GREED of big corporations they cant take a loss they want all there money back and more, sorry this is the bigger picture 😥
Bought my first home in the early 80’s, what he is saying is absolutely the truth, hard to listen too, but couldn’t be more accurate. Make or revise a budget, workout if you can deal with another 4 or 5% on what your paying now. And make a plan now… Hope is not a plan, blaming the politicians and the Reserve bank wont change anything. It’s easy to dismiss as an advert for YBR, but its an honest difficult message that sadly for most will only really be understood when they go through it.
Exactly what we experienced in the 80’s when we bought our first house & 90’s when we had the farm. In the 80’s our interest rate was 13.5% In the 1990’s the Mortgage went to 17.75% & farm overdraft was 22.25% 🙄👎😳😳 We never had to sell in either case BUT in the 90’s with kids, we were fearful we would lose the farm every week. In the 80’s we were DiNKs (Double Income No Kids), so we actually did really well paying double our mortgage payment every fortnight for 3 or so years. Not so in the 90’s with 3 kids on the farm - we lived on the smell of an oily rag. We drove beat up old cars - because we owned them - so no car payments. We heated the house, water & cooked with free firewood we gathered ourselves for basically free. We “made do”. We kept the roof over our kids heads & food on the table but that was about all, there were no luxuries. Haven’t voted Labor ever & never will as long as I live. Hawke, Keating etc turned me against Labor for life! What they did and what they put us through was unconscionable & could never be forgiven & hear they are again doing it to our kids with Each away Albo asleep at the helm. Hopefully this experience will be enough to kick Labor back into the political wilderness for at least another 2 or 3 decades.
Rates going up is good for the economy. It's creates stability and certainty for the markets. Hopefully we will now see at least 10 years of calm and hopefully it gives our children a chance to buy a home finally.
Great encouragement in your video, loved the tone of it. Government over spending causes interest rates to rise, so I would say that this is what actually causes inflation and not simply the rise of interest rates.
I’m afraid I can’t feel sorry for anybody that bought a house in the last five years because you have been warned about it but you still went out and did it the only person you can blame is yourself for not being aware how deviant the banks and the government is
WOW, Honesty at last! I have seen you Mark on the usual News outlets and the feeling I always get is you would always hold back! You understood what was coming but obviously the narrative on those shows didn't allow you to be extremely honest! I remember someone asking you in 2023 "Is it a good time to buy"? You didn't say yes and you didn't say no! It should have been NO! Thanks for being honest now!
Had always seen this fella as somewhat of a celebrity you know the type your never likely to meet. Mark what a unselfish action you offered the community. I'm impressed at your humility. It obviously comes from having sat in their shoes. Jeff Moore.
i was under the impression that the RBA was independent and not a government agency. Hard to blame any government for interest rate rises even if some of their policies may be the cause and affect of inflation.
We didn’t quite have the same world structure in chaos the way we did in 1990, nor the risk of famine, the virus and lockdowns breaking down business, the quiet resignation etc etc….
I was in the same position in 1991. 200k mortgage and over 4k monthly payments. We built the house but couldn't finish it so lived in the garage for 2 years until rates came down to 14%. Young people in NZ have been committing to huge mortgages on over priced houses for fear of missing out on home ownership. I've been advising to look for land and build small, keep mortgage low until this is over (could be 5-10 years)
When Scott Morrison gave out all the free money and small businesses closing, I instantly thought, how on earth are we going to pay the money back. Easy, change government and blame the Albo government!! Not we have interest rate hike after hike, really
I don't see house prices falling anywhere in Victoria. In fact I went to an auction last week guide price was $860-900k. Sold for 1.14. Another auction in another burb was the same story. Guide price was 950.and sold.1.4. Why are people bidding so high, they simply must have the money already
Good on ya Mark! I will be sharing this around, you certainly made me feel better... Far out I'm stressed. I was just looking into the savings and loan crisis last night and it made me a bit depressed. Glad to see that the world didn't end last time. Thanks for the kind words and being a champ :)
@@sidecarmisanthrope5927 Quite possibly the most ridiculous thing I have read. Even in times like these there are still plenty of people who want/need/can afford to borrow money. If someone was not fiscally intelligent enough to know what was coming post covid or seriously thought interest rates would be at 1% for any prolonged period of time, than they need to swallow their medicine and accept they made a mistake and go forward trying to figured out what can they do about it from here. What an absolute load of crap, "the banks encouraged me to borrow so I did". His company did not put a gun to anyone head and say you need to go into debt. They offered a financial solution which was inline with the economic factors at the time to ADULTS who were ready to make the decision to get into property. THEY got themselves into debt, no one else.
@@robbo1234 : Good on you Rob. At least you admit to being a blind and gormless twat. You go ahead and take Mark's advice and get yourself into more financial difficulties. Other commenters on here are praising him for arranging loans for them when no one else would. I worked in finance and I can tell you: Banks don't refuse loans just because they are mean. But don't say you weren't warned. They offered finance knowing what was coming. Economists around the world had been warning of this for the last 3 years. Blind Freddy saw this coming. And if you believe Mark didn't know this was coming, I have a nice bridge for sale in Sydney Harbour. I can let you have it cheap. Now, Away you three inch fool. Please learn the difference between "than" and "then". They are not interchangeable and learn how to use past and present tense in a sentence.
My best advice: Don't borrow leading to instalments that represent more than 30% of your income. You'll live in a smaller house, but it'll be much easier to manage when the corrupt Gov decides to print more money out of thin air and jack up the interest rates. Also, never refinance if you can avoid it, as you'll end up paying way more interests in the long run. Best option is to sell and buy in a cheaper place until you recover.
Oh really 30% ? What rate are you assuming though? You can take out a loan with 30% of your monthly earnings but as rates go up that easily gets to 50 or more
I had two houses when the interest rates were 17.5% my mom lived in one and I was Half way through a renovation on the other. Fortunately there was work to be had but at very little money, I worked 3 jobs seven days a week I was a lot younger then and as fit as a fiddle. I remember others pushing the keys to their houses thru the building society's letter boxes. I always seen property as a long term investment and I never missed one payment God knows how, it was by no means an easy task especially when you had a nutter of a girl friend involved Financially in the renovation project. That was my only mistake and I regret it to this day many decades later, I live by simple rules pay and be paid and if you drop me 50 miles off shore in the winter in the north sea I'm gonna drown,,,, but I will be trying to swim for shore !!🙏
You must be an American. The whole walk away from your mortgage thing is American and not a straight forward option in Australia and UK. And the fact you said Mom too.
@@guser7137 Believe it or not I was in the UK, worst part is they were not penalised they have since bought property again just don't pay to be honest obviously.
I feel for the hardships you have been through. Thanks for sharing your story. With that said, I have no kids and a mortgage. I don't have kids because I didn't think I could afford kids. While there are circumstances that arise and cause misfortune, there are also many variables in life that we humans have control over. I say pretty confidently that how many kids a person has is within the control of people. Particularly with birth control options that exist. In my view, you are complaining that you couldn't live beyond your means. Additionally, it is a warning to people living beyond their means. I'm sorry you couldn't afford a house and support 4 kids and a wife. I also can't support such a big family and therefore I don't have a big family. See how that works? Sometimes we need the humility to know when we can't do a thing before we try to do said thing. If we don't have that wisdom, its not our place to blame the government, or bankers, or rich people for that. I take personal responsibility for my limitations and make decisions in accordance with that. I suspect at your age and level of experience now, you also do the same thing.
The things I hate about these periods in history is people blame Labor for high interest rates. No gov in Australia is responsible for interest rates. We are a leaf blowing in the wind compared to Europe and the USA. Their interest rates are going higher. Even if our inflation stabilised the RBA had to raise rates to stabilise our currency with the USA.
Yes I too had 2 mortgages back in the 90s at -18% It still astounds me that labour still only use the one tool in shed - interest rates!! If they raised the GST 2% it would spread the hurt to all Australians as a whole! Why do they only hurt the mortgage holders every time! That only makes the Banks rich! Commonwealth recently boasted their 5.5 billion for 1/2 year Westpac just boasted 5.5 billion for THE QUARTER! Banks are filling their coffers AGAIN! While the Australian mortgage holders HURT the most! Disgusting 🤢fiscal policies only using 1 tool in the shed!
The RBA is suppose to be an independant body. Nothing to do with Labor. Interest rates started to rise just before the election when Scummo was PM and haven't stopped.
My best advice, if you can’t afford double the 30 year principal and interest payment you can’t afford the mortgage! So much of extended loan terms is not paying off capital that anything else is stupid. In the nineties a lot of people subdivided their homes to survive and did things like grow food and rent out spare rooms. Don’t overlook how barter happened all so, people where trading food or a room for lawn mowing or piano lessons
I don't think selling is an option. Rentals are very hard to find, and the rent is pretty much the same as the mortgage repayments. Selling and moving costs money. You might survive a while on the capital gains you made on your house, but when that runs down, you're back to where you are right now. The only difference is now you pay a landlord 40% of your wage. Interest rates may come back down, but rents don't. Selling your assets to stay ahead is not sustainable.
I think the true difference between 1990 and now is that even if you have to sell you have nowhere to go, there are no rentals, there is nothing cheaper to buy into it is potentially hold on as long as you can because if you cant you might be homeless.
A third of a century ago, there were far less immigrants competing for housing in Australia; Australian born are now paying far more because of massive demand increase due to immigration.
You can't even compare the recession in the 90's to today's economy. Older generation always cry it was real tough, they got no idea. It was a holiday compared to what the young generation are going through the last 10+ years.
This is the by far the most honest assessment of what's going on in the housing market today with new borrowers. Young people, listen to Mark's advice. Sometimes it's better to cut your loses and not lose your relationships and health over a house if the level of debt gets out of hand.
I agree, if you're already struggling it seems that cutting your losses early might land you in a position to recoup some of your deposit. Leave it another 4 or 5 months of being embarrassed and struggling and you could even end up with negative equity and owing the bank even after foreclosure. It sounds like if someone isn't sure they should talk to Mark and his brokers, at least they'd be able to tell you if your situation is unsustainable. A lot of us younger folks weren't really old enough (or maybe even born yet) to really understand the savings and loan crisis. It feels like untested waters. It made me feel a lot better to hear Mark explain this stuff from a position of understanding and compassion. I hope we all make it through and that as many of us as possible can keep our homes, and keep our family together and thriving.
So what are people thoughts should lock in fixed now?? As I’m on variable first home had for 12 months now
This has been playing on my mind for some time
Should have raised the rates two years ago
Inflation was rising in mid 2020 due to Over stimulus and silly low rates (trap), yet the RBA hid the fact and kept saying it's under our threshold ,
When they couldn't hide it they said don't worry it's only Transitory
i remember the recession in the 90's... I had just become a tradesman's plumber... my boss died of Leukaemia ..I tried working for other guys but no one was building houses... I got a job on the docks of a trucking company.... drove trucks for 20 years after that...I now run my own small biz as a gardener... strange how things and life plays out sometimes
Absolutely. The best advice we can give to our kids is keep learning and be flexible.
no one cares, not a sole came here to read your life's story this video is not about you
I am selling my tractor and slasher . Go to gum tree
Good on you Mark... Your message and advice could well have saved some marriages... and even someone's life in these very difficult times.
And if he had told these people not to borrow too much on a house they could not afford then those people would not be facing this now.
@@sidecarmisanthrope5927 Hahahaha! Wow! Aren't you just the kind arsehole one would want for a consoling friend in a crisis! 😂 I'll bet you're terribly missed when you breath your last fella!
@ Mark Bouris
Your story is exactly the same as mine. I had a business back in the 80s, that was making $10,000 a week, clear profit. However, I had my banking with Pyramid building society. They went bust, so I lost my cash, but worse than that, there was no work to be found in my industry after they crashed. So I lost my house. I had 4 kids at the time, and lost everything. Today. I'm 63 and have 5 kids, 8 grandkids and 1 more on the way. Got married for the second time, 15 years ago, and have just managed to save enough to buy a home. My first home since I lost everything back in 1990. And we had to put down 20% deposit, so we have nothing left in the bank. Things are look grim again. I wonder was I always doomed to never own a home? I had a heart attack a few years ago and I don't know how I'm going to earn enough to pay off the mortgage now. I have no super because I always worked for myself. So it's a bit of a pickle.
But we will continue to hold our heads high and push on.
Are you saying you've taken out a mortgage at 63?
Thanks for the message Mark. In the 90s I remember my father was pretty stressed and we weren't allowed to use the lights or have the TV on for a few months. Dinner was literally frozen veggies and a chicken. There were three of us kids. One car for a family of five. That's how bad it got. We kept the house but my parents only told me later how close they were to losing it all. I see everyone with their 50k SUVs and think maybe you just have to live a little more simply to get through this.
@STEPHANiE I'm just not seeing that. People seem to still be spending. If that's the case then I would suggest cancelling Netflix, not buying the latest apple phone, ditching the Ford ranger for something practical and buying food instead of booze and cigarettes. What happened to all the handouts from the last two years???
@@cthorno2991 A lot of people in Australia are well off due to property deals. Everyone who owns a house in a capitol city is a millionaire. That stuff about inflation and higher prices hurting Aussies is to a large extend BS. Many well off Australians vote hard left green because they can afford the expensive green policies of those parties. Rich, green and virtue signalling. That sums up a large part of Australians.
@@jackmorgan1677
Owning a house outright with a suitable income would make most comfortable and homeownership has been the method most people use to get ahead but the interest rate rises (to something more normal) don't affect all Aussies the same way, some are close to the edge with little to no savings as a buffer.
1/3 of Aussies rent, (rents in capital cities have been rising sharply) 1/3 are buying their house, and a 1/3 own their house outright. A percentage of those in the first two groups could be in trouble due to interest rates leading to high rents/high mortgage payments, particularly those who purchased in the last couple of years or who borrowed to the limit. As interest rates go higher and property prices reduce, perhaps leading to negative equity issues, more in these categories could find themselves in trouble. But those who own their house outright or have small mortgages, don't care as much about interest rates & house price moves, higher interest rates to them may just mean a better return on their savings.
I do agree that many who vocally support green policies are often not affected or barely affected by the costs and outcomes of the policies they support, nor despite their claims of virtue, do they care about the effect those policies and costs have on others.
There's a saying in the finance industry for times like this. If you have to panic, panic first. The last ppl to sell in a market downturn will get burned the hardest. If you think you can survive, run scenarios to see if you can still hold on if your missus loses her job, or your car shits itself, or your bonus doesn't come in. Plan for the worst case scenario and pump as much money into your offset as contingency.
The trouble is most people thought the good times would go on for ever. I spoke to people who had this mentality, most of them just laughed at me when I would tell about the 90s. These ones will hopefully learn a lesson from this and move on and ahead in there life.
I went thru the time Mark refers to. I’ve been telling my kids for to do their sums on 8%. Historically low rates means they only had one way to go. I think these are uncharted waters for first home buyers.
@@liamgross7217 Not just historically low, but there was a lot of political pressure to keep them low. They should not have been that low. When people talk about "market failures" it's almost always because of "market interference" by politicians.
@@liamgross7217 I'm a recent first time home buyer, but I had a large deposit for my first house that I saved myself. Once I bought my place I did the basics, new paint, carpets etc to make it much nicer. Beyond that I've diverted all my cash into the offset and living well under our means because I could see the lower interest rates weren't going to last forever. Suffice to say I'm reaping the benefits now and not stressed because I went through my scenarios and prioritised financial security above all.
@@turbostyler amazing what comments TH-cam delete. You seem to have made very wise decisions which are what is needed now more than ever. Best wishes 👍
This was one of the simplest and most honest and empathetic few minutes from a person of note that I've seen in a very long time. Thank you.
So you should call him so that he can help you refinance and he will make even more money from you.
As a highschooler in the early 90's I saw the pain this caused & realised how unfortunate it was that so many were so deeply emotionally invested & narrowly financially invested in a building. Your happiness doesn't come from a wooden box that sits out in the weather & slowly rots.
Love your inspiration. Lost 2 jobs over the last 2 years. Also went thru the flood . Survived on an oil rag and I am going to keep on , learnt to take help where I could and look forward to continuing to help others where I can 🙏. Keep up your great work 🧘♀️
Probably the best and most honest advice I have heard. No click bait title with someone’s stupid head and trying to cause fear and panic. Great sensible content
40% of my wage goes into the house I live in. Too bad it's owned by someone else. Still, absolutely fantastic advice. We need to see more Mark Bouris advice on TV.
Agres rent is as high so no point selling your house tbh
the sad part is the guy your paying rent too likely owns the house so rising rates are not effecting them its just making high money from renters that have nowhere to go.
Rent is all you have to worry about, it's easier! The person with the Mortgage has to pay the Bank, Mortgage Insurance, House Insurance, Rates, Maintenance etc. etc. So, you see the real cost to them! Keep Renting!
Funny how legally you have to show you only spend 20% on wages
@@aprilmanley5414 Most people that buy a house want to eventually give it to their children, to make life easier for them.
The main ingredients for a strong foundation in life - Honesty and Happiness.
Every single person can control their Honesty .
You just restored a little faith Mark .
Thanks and well said .
Great message, Mark! Not gonna lie though, I do feel a real element of personal responsibly should be on all those who've taken out a heavy mortgage. I am one of those, and my fixed rate's coming up in about 6 weeks. I purchased in 2017- but a shitty little 2 bed unit with good bones with repayments being about 1/4 of my salary. Because I KNEW that was all I could afford, and it's only my 1st home. You do not go out & buy a in a fancy new estate with no work to do on it as your 1st home. Do do the grandparent thing, buy the shitty fixer upper like I have & put sweat equity into it!
Correct, buy a RUN DOWN HOUSE and fix it , Thats how the europeans did it when they came to Australia in the 70s/80s.Now they are self made Millionaires.
You buy the best you can afford.
You should sell now before your in negative equity. Shit going down like a house on fire
@@Mazza666 If you can keep you property don't sell its not right time move out find cheap rental collect rent and top up your repayments. They're doing this deliberately satanists be smarter than they are They're greedy monsters. God is helping those who can help them selves God bless all good people will be okay 👍 👌
@@andhewonders Only if you're confident the housing market is going to be rising for a long time. Otherwise you'll end up losing a lot of money if forced to sell at a loss. There were a lot of people who bought the best they could afford who ended up losing bigtime when the interest rates hit 17%. The ones who were in cheaper properties could ride it out easier and were much better placed once the recession ended.
Mark got me my very 1st loan. His company was the only one who really worked hard on securing it & took a leap of faith. Will never forget his help.
So, his company was the one who put you in debt when the others said you couldn't afford it? Interesting.
@@sidecarmisanthrope5927 What a load of assumption shit.
@@carmenandthedevil2804 : You don't know what the word "assumption" means.
There are good reasons why banks and home lenders refuse to lend to certain people. And it is not because they don't like your hairstyle.
I was pumping in more then 55% back then into my house, i didn’t sell I lived with my sister and rented my place out for 3 years the money went into paying off the mortgage I later on sold and lived in my apartment that I now own also used to rent out. Best advice is to not panic we sold all our cars and I rode a 250 cc motorcycle and wife at the time caught the bus. Didn’t go out anywhere and saved everything.
You're a genius compared to most. People can't fathom renting their house out and having some other scmuck pay the mortgage off for you
Well I can only say well done and i'm sure your happy now.
@@janeblogs324 I went to a financial planner who actually gave me good advice on how to solve my problems. The irony being that it cost more to live in your place than rent. You can claim a percentage of things.
@@brmbrrmm5442 I didn’t want to do it but I didn’t have much choice. I did help my sister a lot with renovations and child support.
@@ADSCoachSimonB2112 negative gearing powers our economy. Our parliament/politicians own on average 8 houses each. Join the cult
I bought my home in the early 90's on a fixed 30 year mortgage of 4.5%. The taxes and insurance are more of the payment than the principal and interest. My biggest fear however, is another shutdown without pay. I could have easily lost everything if not for having some savings which are now depleted. Any worries I might have are caused by the Government in one way or the other. No one is safe from Government.
Are you American? I ask because I see Americans getting these really long-term fixed interest loans, and they're just not available to us.
@@martinXY Yes, I'm a Yank. I wasn't aware that you didn't have those available. They can be a good thing to get into a home for first time buyers, but the long terms of 15 and 30 years can really add up in interest even at a low interest rate. I remember now that my initial interest rate was a bit higher than what I stated, but not much. What hurt me was refinancing for the lower rate, and optioning for another 30 years to get my monthly payment down. I've learned from my mistakes but too late. Should have bitten the bullet, gone for 15 years and left it alone, except for adding extra to the principle as often as possible.
@@jameydenison2045 OK, so it was fixed interest AND fixed repayments. You couldn't pay more per month and finish earlier.
@@martinXY No, I've started paying extra on the principle each month and am hoping to pay off in 10-12 years now. Covid situation nearly wiped me out, so everything is much harder financially now. I'm handling it, though. Thanks.
I may have missed something here, but there is no way there are taxes and insurance that come anywhere near the interest on my mortgage.
Different country, different system?
It's just four walls and a roof. There are thousands of them within 10 minutes of yours. You'll survive.
As my father once told me...
"First one up is the best one dressed".
Stay strong. Love your family members. You're all they have too.
Kerry Packer would’ve made a great prime minister and run this country as a business and not sold it off slowly. Maybe you should consider starting your own party Mark and turning us around like Norway. Owning all our own resources would be a great start. Thanks for your advice mate.
You know youre wife truely understands when she asks for a divorce during tough times.
Hahaha
My brother asked me sell my house snd move in to live with his family. We Asians take care of our family.
your brother is smart, move in and pay him rent to pay down his mortgage.
Thank you so much for the support, I had to sell my house but shit happens and you move on. Your shows are awesome and honest
Well said Mark, I was exactly the same in the late 80's, I hope those with mortgage stress take youradvice!!
Thank you Mark - I have been renting for 14 years and am being kicked out of the rental property. I am moving into a smaller place that is more expensive but thank you for your encouragement and empathy.
I’ve legitimately always liked this guy. Don’t know him from Adam but just always came across as someone who wants to help at the same time being a business guru.
Reminds me character wise to Dick Smith
I had breakfast with Mark many moons ago and he is salt of the earth, true blue.
This message is like closing the gate after the horse has bolted. And yes Lenders including Mark opened the gate
yep..she has well and truly bolted 🐴
Good genuine video, thanks mate. It reminded me of when I declared bankruptcy many years ago. It was humiliating, depressing, & much more. A friend gave me the best advice I could ever have dreamed of, ... he said "in business, bankruptcy is just a right of passage". That fleeting comment carried me further than anyone will ever know.
I don't want to see ordinary people lose their homes but I would like to see a reckoning for the people with portfolios of 50 airbnbs..
Increase your income.
Make sacrifices of your leisure time converted into work time.
Decrease your spending. You'll be surprised what you can live on.
I've had one mortgage after the other for 40 years.
No holidays, I rewarded myself eating out or buying a good steak now and then.
I bought groceries I needed rather than wanted. Or bought "on specia"l items.
Take a walk or cycle rather than drive saving fuel and running costs.
Buying clothes from second hand stores etc.
Draw up a budget. Look at it weekly to find more cost saving measures.
I'm a dumb arse, but I listened to older people who had already been through tough times.
I already do alot you mentioned. I don't own a credit card, I rarely buy takeaways, I always take my lunch to work and I cut my own hair. I don't have fake nails, botox, labeled clothes but, I do have 2 dogs. Why should my interest rate go up, up, up, when I am only trying to save.
@Gee Bee that's great. You're ahead of the game.
Optimism has been on a high for 20 years, and yes, the banks have become rich. We were sold a lie by the reserve bank. To keep us optimistic.
However, if we can hold on until things turn around in the next upward cycle, we can become rich too.
Tightening the belt will get many people through.
One other thing no one will tell you is that you have negotiating power if you have a mortgage.
My last one was 450,000.
As the reserve raised rates, the bank did too.
Each time, I rang the bank, Commonwealth 13 number, and asked for a review of my conditions. Four times in 5 years, they agreed to a discount of the rate rise. The first answer will be the standard, sorry no.
Tell them you will refinance, they will tell you it will cost you money. Tell them it's worth it. They will bend.
Stay optimistic and confident.
@@geebee1983 Sounds miserable have you looked at increasing your income all that above comment talked about was cutting things out, not once did they mention increasing their income. Life is to be lived not about cutting every single thing out
Funny how many Australians have been conditioned to accept poor living conditions just to afford a roof over there heads
@ifnottoday The problem isn't a roof over their heads. It's the conditioning to get everything you want in a house, car boat etc.
My first house was 100m2 fibro dump that no one else wanted.
I renovated it because everyone else was.
I've never renovated a house since and made money out of each of them.
Things don't make us happy. Good relationships do. Contentment...
There are over 11,000 houses for sale in Queensland, Australia, under $350,000, and people say, "Oh, I wouldn't live there."
I never bought a property I couldn't afford if interest rates climbed to double what they were at the time of purchase.
I also negotiated a better deal than the bank was offering on paper.
Nobody gets everything in life, not even the rich.
I wish I paid 40% of my income to OWN the house I live in. I'm renting and it costs me 50% of my income to exist in this house. Not to mention the money I have to spend to maintain the yards etc. The rich whine about losing a bit of money, while the poor lose everything, including the will to go on sometimes.
Well said
Rent out a room of the house to help
I'm in the same position. Can't get on the ladder
They were handing out money hand over fist in the 80's.....until '89 when the recession hit and banks became real estate agents.
Within the space of eighteen months; My partner bought a commercial property for $1.125mil......valued at $2mil not long after.....Banks took possession and sold it for 475K
This analogy is 100% correct, listen and tighten your belts.
Bang On! History repeating! Good on you Mark.. Your heart felt message and honesty is something everyone needs to hear....especially those who have not lived it before.
This is like a talk from your successful uncle who has the wisdom and experience to share his knowledge and give you guidance. This conversation, in that way, felt kind of intimate and genuine. You are a stand up bloke Mark.
Wow what a great sincere message. Appreciate you even though I’m not in Australia....we are seeing the same things here in the U.S.
Good on you Mark. At this stage my wife and I are ok but you have given us the best advice of what is about to happen. You are a good man. I hope more people watch this video. Thank you
Great wisdom! I learned my lesson in 2010. I was able to keep my house, but, it was a rough time. I will never take a loan out again. All the best. Jim from Georgia/ US
The reserve bank isn't the government.
They are a private organisation that should be paying tax.
Finally a voice that mirrored my thoughts. As a single parent I've fast tracked my mortgage payments as much as possible last couple of years, preparing for a rainy day, and now the interest rates can't take the home away from me and my kids anymore. That is a good feeling.
Don't have a mortgage but I will listen to any advice Mark has to say about finance.
Happened to me in 2009-2010 , got a house but then lost my job twice , had to sell , good life lesson , got a house again in 2014 , have put all my spare cash on it , it’s bloody hard but can be done , thanks Mark
Love the straight talk and genuine compassion. Business is business but business done well is compassionate.
RBA …making 30% of the adult population pay through the nose to control the spending of the rest of the population….It worked 30 years ago when most had a mortgage, today it’s different…..great vid Mark.
Yep makes zero sense, just raise gst instead
I was in the same boat in the late 80’s as well….my interest rate was 17.5% from memory and trying to pay off a mortgage on around $400/week. I had to get out in the end….and rented for the next 8 years. Just a tad gunshy of the Government and the banks. For me the best thing we have done is go hard on our mortgage by sacrificing paying into other non essentials. That mortgage no longer exists as a result. Wiped it out in 20 years instead of 30 with a revolving line of credit, a 55 day interest free debit card and budgeting discipline.
Forget the luxurious lifestyle of Uber eats and eating out. Upgrading the car every 3-4 years, sporting the latest handbags and watches. These are the key culprits to killing off getting ahead. Everywhere I look it's all new cars and lineups for luxury shops. Not to mention Uber eats cyclists peddling everywhere.
Haha, right? I just have a hoopty 2010 Barina I bought in cash in 2015, still gets me from a to b. I don't give 2 shits what people think, I ain't in debt (other than the mortgage!)
Only applies to those who have a mortgage or rent buddy. For the rest of us the luxuries continue.
@@johnnybgood3909 good to see humble people who are still modest and don't like bragging.... I'm not ya buddy either.
I think in this modern age, if you sell your house, you'll never get back in because the cost of housing is through the roof and continues to rise, and trying to save another deposit for an over inflated market to begin with will keep most of those people well and truly out.
Our Govts have really screwed us this time. They have demonstrated year after year that they are totally inept at running an economy.
I'm lucky I purchased when I did, because there's no way in hell I could afford a 750K + mortgage today. What do you get for $750K these days ? A mouldy old fibro shit box.
The lucky country ???
It is absolutely disgusting how we have descended into this nightmare and the rich ivory tower wankers of this society couldn't give a hoot.
The old saying goes. "I'm all right thanks Jack"
# Respect Mark... I myself, very much remember the economic pain in the 80's. The only thing that saved us during those 80's/90's ever-increasing mortgage rates, was that our home loan was locked in at 13%. But unfortunately, I'm to this day, still very angry! To those out there, that are going through this sh@t show... I know and feel your pain, and I hope in time (unlike me) you can let go the anger.✊
Having lived through and paid the mentally and physically debilitating mortgage variable interest rates of the 80's starting at 8% and rising to 17%, I am in complete agreement with all Mark has said. During these times it seemed that multiple 'Home for Sale' sign were erected in my street every week over an extended period. Fortunately, I was able to retain my home, but it did come at a life changing cost that was much more precious than money.
Good advice Mark, my wife and I went through the late 80’s struggling to pay our mortgage especially when it hit 18%, we stayed together,She working a second job and me fortunately able to get more overtime and doing odd jobs, I can see these increasing interest rates
paralleling the times back in the 80’s.
To all young people , I know it is a struggle and it is hard , but in 30 years time when you look back you will realise how cheap your house was to buy. Better to struggle young than old for home ownership.
"it happened to me , now it's your turn" wow, sage words from the super guru...
Great message and generous offer Mark. People will need your help in coming months for sure. We are coming into tuff times
My partner & I are so lucky we swapped from variable to split when rates were at 1.99%. We now have about 20% variable, which is 100% offset and 80% fixed at 1.99% until 2025. I feel for so many people that were not fortunate enough to be able to do a similar thing. I Hope Mark can help anyone who needs it.
I would estimate the bank has stolen about 20k off me lately thru close to zero interest rates. Why don't seniors who slogged to put some money in the bank get any sympathy for how tough it was to pay the bills with no interest?
What a great speaker. You make sound easy only because you are speaking from the heart. Something no politician has. Thank you.
Mark would you say the new problem is also when you sell the house u cannot afford to pay. Where do u live? Rental market is crazy.
I was the same. Mortgage 17% and working hard.
Today, no debt. 🎉🥳
Folks..get rid of as much debt as you can and tighten your belt NOW. That also means minimising your expenses. Take the pain now before it gets worse.
Righto I'll just pay off my 30 year mortgage in 2 years and i should be fine.
@@ageraRable you got the philosophy right…you now need a strategy to drive in that direction.
@@ageraRablemeans bad debt like credit cards, personal loans, car loans, overdrafts.
Another thing you could do is cut your subscriptions, stop eating out, make birthday gifts max $50-$100 and learn to suffer with less... learn to be uncomfortable so when hard times come, you are resilient because you know how to survive. Embrace the pain and be proud when you come out of this phase and always think of the steps you need to take to ensure you are not in this place again.
Watched my parents go threw that in the 90's ....I learnt a lesson .....We bought a house out in the bush b4 anyone wanted to live in the bush ...paid 130k 8 yrs ago ...friends though we were crazy .....We own our home now ....I could care less for the interest rate ....Good luck
Thanks so much Mark for offering help to many who will desperately need it, a great reminder that you can come back even after the terrible experience of losing your home. Why should families with mortgages have to bear the brunt of the cost of reducing inflation anyway? Higher interest rates are just another type of inflation shifting the problem onto people trying to buy a home for their families. It’s about time the govt stops hiding behind the Reserve Bank and stands up with sharper policies to reduce inflation and spread the pain across the whole community - including reduce govt fiscal spending in the short term, and actually doing something to address the real problem (supply) and encourage new sources of supply by encouraging and assisting business in the long term.
We were so fortunate, just as the long period of low mortgage rates was coming to an end, my old fixed rate expired and I got a new one. My advisor said go for a Three year at 1.35%….but I thought no, I can almost smell the end of cheap rates…so I went for 1.7% fixed for Five years. That was great because that slightly cheaper rate at the end of just three years would rocket to like five percent…My new rate keeps us in low outlay for five years during which I will aim to knock it down a fair bit.
I’m happy that someone is giving an honest outlook. Well done mate.
With respect, this is nothing like before. You talked about relative income but what about the actual asset price lol. Houses now are 10-14x wages, and the asset itself is likely to be $1m+ and a deposit higher than the outright price of a house in the 80's if not 90's. It's a tougher market now, by far, we'll see what happens.
Great message, but where do all us home sellers rent?
Plus, most people that have a mortgage, also have one or two expensive car loans.
Bigger problem is there no houses to rent or they have astronomical Rent prices, thats why we trying to hang on, I'm over the GREED of big corporations they cant take a loss they want all there money back and more, sorry this is the bigger picture 😥
Bought my first home in the early 80’s, what he is saying is absolutely the truth, hard to listen too, but couldn’t be more accurate. Make or revise a budget, workout if you can deal with another 4 or 5% on what your paying now. And make a plan now… Hope is not a plan, blaming the politicians and the Reserve bank wont change anything. It’s easy to dismiss as an advert for YBR, but its an honest difficult message that sadly for most will only really be understood when they go through it.
"We're from the government, and we're here to help."
I was thinking just that thing.
Mark is right except I'd say that what's coming will be worse than 1989 but the solution is the same as he says..and I well remember 89/90.
people have been warning for 15 years, anyone who listened 15 years ago missed out.
Exactly what we experienced in the 80’s when we bought our first house & 90’s when we had the farm.
In the 80’s our interest rate was 13.5%
In the 1990’s the Mortgage went to 17.75% & farm overdraft was 22.25% 🙄👎😳😳
We never had to sell in either case BUT in the 90’s with kids, we were fearful we would lose the farm every week.
In the 80’s we were DiNKs (Double Income No Kids), so we actually did really well paying double our mortgage payment every fortnight for 3 or so years.
Not so in the 90’s with 3 kids on the farm - we lived on the smell of an oily rag.
We drove beat up old cars - because we owned them - so no car payments.
We heated the house, water & cooked with free firewood we gathered ourselves for basically free.
We “made do”.
We kept the roof over our kids heads & food on the table but that was about all, there were no luxuries.
Haven’t voted Labor ever & never will as long as I live. Hawke, Keating etc turned me against Labor for life!
What they did and what they put us through was unconscionable & could never be forgiven & hear they are again doing it to our kids with Each away Albo asleep at the helm.
Hopefully this experience will be enough to kick Labor back into the political wilderness for at least another 2 or 3 decades.
Rates going up is good for the economy. It's creates stability and certainty for the markets. Hopefully we will now see at least 10 years of calm and hopefully it gives our children a chance to buy a home finally.
The RBA is 100% responsible for the pain and suffering of home owners. Central Banks control the governments not the other way around
In the USA we have fixed rate loans for 30 YEARS! Isn't that crazy? lol we're lucky.
Our fixed is on 30 yr loan too. I wouldve never bought a home without it after 2008
You can also walk away from you house if you can't afford to pay it in the USA, in Aust you are still liable for any outstanding debt.
Your a good bloke Mark, full of honesty and integrity
Sadly the people having to sell their houses are faced with extraordinary rental prices and that is if they can find a rental.
Nice one Mark...you are doing more for this country than the RBA, that's for sure.
You really didn't listen to him did you??? Or understand what he said if you did!!!
@@yellowscott There is nothing wrong with my comprehension...now run along you tediously dull little troll.
Great encouragement in your video, loved the tone of it.
Government over spending causes interest rates to rise, so I would say that this is what actually causes inflation and not simply the rise of interest rates.
I’m afraid I can’t feel sorry for anybody that bought a house in the last five years because you have been warned about it but you still went out and did it the only person you can blame is yourself for not being aware how deviant the banks and the government is
WOW, Honesty at last! I have seen you Mark on the usual News outlets and the feeling I always get is you would always hold back! You understood what was coming but obviously the narrative on those shows didn't allow you to be extremely honest! I remember someone asking you in 2023 "Is it a good time to buy"? You didn't say yes and you didn't say no! It should have been NO! Thanks for being honest now!
2023 can be a great time to buy! People have different circumstances, so it not NO for everyone.
Thank you Mark, good on you for telling us your story. It wasn't your fault then and it isn't ours in our struggle now. We'll get through it
Had always seen this fella as somewhat of a celebrity you know the type your never likely to meet.
Mark what a unselfish action you offered the community. I'm impressed at your humility.
It obviously comes from having sat in their shoes. Jeff Moore.
i was under the impression that the RBA was independent and not a government agency. Hard to blame any government for interest rate rises even if some of their policies may be the cause and affect of inflation.
We didn’t quite have the same world structure in chaos the way we did in 1990, nor the risk of famine, the virus and lockdowns breaking down business, the quiet resignation etc etc….
So good to see a positive message. Bless you mate
You're an absolute legend Mark :)
I was in the same position in 1991. 200k mortgage and over 4k monthly payments. We built the house but couldn't finish it so lived in the garage for 2 years until rates came down to 14%. Young people in NZ have been committing to huge mortgages on over priced houses for fear of missing out on home ownership. I've been advising to look for land and build small, keep mortgage low until this is over (could be 5-10 years)
$4K a month on $200K? Blardy hell! I'll never complain about my mortgage again.
When Scott Morrison gave out all the free money and small businesses closing, I instantly thought, how on earth are we going to pay the money back. Easy, change government and blame the Albo government!!
Not we have interest rate hike after hike, really
I don't see house prices falling anywhere in Victoria. In fact I went to an auction last week guide price was $860-900k. Sold for 1.14. Another auction in another burb was the same story. Guide price was 950.and sold.1.4. Why are people bidding so high, they simply must have the money already
Good on ya Mark! I will be sharing this around, you certainly made me feel better... Far out I'm stressed. I was just looking into the savings and loan crisis last night and it made me a bit depressed. Glad to see that the world didn't end last time. Thanks for the kind words and being a champ :)
This is like the fox telling you how to secure the chicken house.
His company put thousands into this deep debt.
@@sidecarmisanthrope5927 Quite possibly the most ridiculous thing I have read. Even in times like these there are still plenty of people who want/need/can afford to borrow money. If someone was not fiscally intelligent enough to know what was coming post covid or seriously thought interest rates would be at 1% for any prolonged period of time, than they need to swallow their medicine and accept they made a mistake and go forward trying to figured out what can they do about it from here. What an absolute load of crap, "the banks encouraged me to borrow so I did". His company did not put a gun to anyone head and say you need to go into debt. They offered a financial solution which was inline with the economic factors at the time to ADULTS who were ready to make the decision to get into property. THEY got themselves into debt, no one else.
@@robbo1234 : Good on you Rob. At least you admit to being a blind and gormless twat.
You go ahead and take Mark's advice and get yourself into more financial difficulties.
Other commenters on here are praising him for arranging loans for them when no one else would. I worked in finance and I can tell you: Banks don't refuse loans just because they are mean.
But don't say you weren't warned.
They offered finance knowing what was coming. Economists around the world had been warning of this for the last 3 years. Blind Freddy saw this coming. And if you believe Mark didn't know this was coming,
I have a nice bridge for sale in Sydney Harbour. I can let you have it cheap.
Now, Away you three inch fool.
Please learn the difference between "than" and "then". They are not interchangeable and learn how to use past and present tense in a sentence.
I am in this exact position, have felt terrible for the last 9 months. I cannot physically work any more to try and keep up
My best advice: Don't borrow leading to instalments that represent more than 30% of your income. You'll live in a smaller house, but it'll be much easier to manage when the corrupt Gov decides to print more money out of thin air and jack up the interest rates. Also, never refinance if you can avoid it, as you'll end up paying way more interests in the long run. Best option is to sell and buy in a cheaper place until you recover.
Oh really 30% ? What rate are you assuming though? You can take out a loan with 30% of your monthly earnings but as rates go up that easily gets to 50 or more
I had two houses when the interest rates were 17.5% my mom lived in one and I was Half way through a renovation on the other. Fortunately there was work to be had but at very little money, I worked 3 jobs seven days a week I was a lot younger then and as fit as a fiddle. I remember others pushing the keys to their houses thru the building society's letter boxes. I always seen property as a long term investment and I never missed one payment God knows how, it was by no means an easy task especially when you had a nutter of a girl friend involved Financially in the renovation project. That was my only mistake and I regret it to this day many decades later, I live by simple rules pay and be paid and if you drop me 50 miles off shore in the winter in the north sea I'm gonna drown,,,, but I will be trying to swim for shore !!🙏
You must be an American. The whole walk away from your mortgage thing is American and not a straight forward option in Australia and UK. And the fact you said Mom too.
@@guser7137 Believe it or not I was in the UK, worst part is they were not penalised they have since bought property again just don't pay to be honest obviously.
I feel for the hardships you have been through. Thanks for sharing your story. With that said, I have no kids and a mortgage. I don't have kids because I didn't think I could afford kids. While there are circumstances that arise and cause misfortune, there are also many variables in life that we humans have control over. I say pretty confidently that how many kids a person has is within the control of people. Particularly with birth control options that exist.
In my view, you are complaining that you couldn't live beyond your means. Additionally, it is a warning to people living beyond their means. I'm sorry you couldn't afford a house and support 4 kids and a wife. I also can't support such a big family and therefore I don't have a big family. See how that works? Sometimes we need the humility to know when we can't do a thing before we try to do said thing. If we don't have that wisdom, its not our place to blame the government, or bankers, or rich people for that. I take personal responsibility for my limitations and make decisions in accordance with that. I suspect at your age and level of experience now, you also do the same thing.
The things I hate about these periods in history is people blame Labor for high interest rates. No gov in Australia is responsible for interest rates. We are a leaf blowing in the wind compared to Europe and the USA. Their interest rates are going higher. Even if our inflation stabilised the RBA had to raise rates to stabilise our currency with the USA.
Yup , i lived through this time and many friend lost there homes .
Home Prices Fell and Fell and Fell !
no they didn't
Yes I too had 2 mortgages back in the 90s at -18%
It still astounds me that labour still only use the one tool in shed - interest rates!!
If they raised the GST 2% it would spread the hurt to all Australians as a whole! Why do they only hurt the mortgage holders every time! That only makes the Banks rich!
Commonwealth recently boasted their 5.5 billion for 1/2 year
Westpac just boasted 5.5 billion for THE QUARTER!
Banks are filling their coffers AGAIN!
While the Australian mortgage holders HURT the most!
Disgusting 🤢fiscal policies only using 1 tool in the shed!
The RBA is suppose to be an independant body. Nothing to do with Labor. Interest rates started to rise just before the election when Scummo was PM and haven't stopped.
My best advice, if you can’t afford double the 30 year principal and interest payment you can’t afford the mortgage! So much of extended loan terms is not paying off capital that anything else is stupid. In the nineties a lot of people subdivided their homes to survive and did things like grow food and rent out spare rooms. Don’t overlook how barter happened all so, people where trading food or a room for lawn mowing or piano lessons
I don't think selling is an option. Rentals are very hard to find, and the rent is pretty much the same as the mortgage repayments. Selling and moving costs money. You might survive a while on the capital gains you made on your house, but when that runs down, you're back to where you are right now. The only difference is now you pay a landlord 40% of your wage. Interest rates may come back down, but rents don't. Selling your assets to stay ahead is not sustainable.
I think the true difference between 1990 and now is that even if you have to sell you have nowhere to go, there are no rentals, there is nothing cheaper to buy into it is potentially hold on as long as you can because if you cant you might be homeless.
A third of a century ago, there were far less immigrants competing for housing in Australia; Australian born are now paying far more because of massive demand increase due to immigration.
You can't even compare the recession in the 90's to today's economy. Older generation always cry it was real tough, they got no idea. It was a holiday compared to what the young generation are going through the last 10+ years.
Yet I’m my area north east Victoria, I see multiple empty homes…. Who owns them? Anyones guess- Probably offshore investors.
@@petesmitt That's it mate blame immigrants you need to stop reading the daily mail you bigot.
We are proud of you Mark,a real true blue ! Thank you.