I think the renting class are the realists.

If the rents are too high, go live on the street or a car or at Grandmas near empty house.

I still have my post depression relations voices ringing in my ears; don’t borrow money for what you can’t obviously afford.

Housing is way way unaffordable for most people.

The graph is a classic. It points out exactly the traps. Todays interest and inflation rates still compare very favourable with the not too distant past.

The future from heron in, can only be a very rough ride for borrowers at unrealistic interest rates. Blind Freddy could work this one out many moons ago.

I am not affected by interest rates. I have owned three houses, always paying off the mortgages early - and at much, much higher rates than the current ones. I suppose I should feel sorry for the current bunch of home buyers - but, I do not. They think they know better than I do about everything, so they should be smart enough to deal with it,

But, half million dollar mortgages. Ye Gods! How can anyone be that stupid? Particularly as, unlike their parents and grandparents - whom they sneer at - they won't live frugally, start off small and save to pay off the mortgage. No. They want a rich-person's lifestyle.

Home ownership WAS always an Australian 'thing', while other in countries, particularly in Europe, people rented privately or got into abundant 'council' housing.

In Australia, renters were looked down on as second class citizens.

Well, those days are gone for good. Governments are going to have to get off their lazy arses and build public housing. And ordinary Australians are going to have to get used to the idea that there is no 'right' to home ownership and MacMansions that they cannot afford.

if the "want everything now" generation didn't get themselves locked into such insane mortgages, the cost of housing would drop to sensible prices.
Real estate agencies, Banks & above all Local Govt & Councils are the underlying cause of the high costs of everything right now because they in turn are locked in with incompetent & greedy bureaucracy exploiting just as greedy & incompetent Woke voters !

Too slow for too long. Should have hit with a 1% to start with and then 2%. Shock and awe and a statement that more could be done with even higher more brutal rate rises would give some folks cause to pause and pull back spending.

This drip, drip increase, simply extends the pain and bank profits to the Enith degree. And may need to hit 9% before it slows inflation. It's using a sledgehammer to drive tacks. And a very blunt instrument.

A better strategy would have been to drive down energy prices with determined action. And if that meant a sovietised power supply system then that should be the course we take, rather than allow offshore circumstance to decide what we do here with OUR COAL, OUR GAS, OUR POWER PLANTS AND OUR TRANSMISSION LINES.

At least what was once ours before the insanity of privatization! And should be rescinded, undone and handed back to those who built, developed and owned them. Sold out from underneath without a flagged pre-election mandate by crimson fools selling out the nation's heritage for some tenuous political outcome!

A purpose-built factory would be able to assemble one MSR thorium power plant every week using a known and proven design with all the bugs ironed out. And already done elsewhere.

We have a nuclear reactor and are getting nuclear subs. Will play host to B 25s and possible nuclear armaments.

Any real reason for not transitioning to our inevitable long term future baseload (carbon free) 24/7 power supply source has faded with our very changed circumstances and the need to do something real about climate change, now while we still have the means to make that decision for ourselves!

The time for endless prevarication and eternal, half smart, obtuse obfuscation is long past and needs to be changed for sane pragmatism!
Alan B.

My youngest daughter was wise to decide to get out of her recently built dream home after the divorce, payments were just too high for a now single mother. This was while interest rates were still extremely low.

I can't imagine why people expected interest rates to stay at rock bottom for ever, it was just not likely looking at history. Mid 80s I was getting 17% on my fixed deposits, & early 90s I was paying 14% on the bridging loan when I bought this place, before finalizing the sale of my last place. Sure the kids did not actually "live" through those times as adults paying those rates, but surely any thinking adult should have researched history before borrowing.

On public housing, I believe it is totally immoral to expect those struggling with repayments & ownership costs on their own homes to fund the less prudent into homes at much cheaper costs than themselves. Public housing rents for low income earners or welfare recipients are often less than the costs of rates, insurance & interest payments of home buyers, before any actual loan repayments are made. This is not a suitable reward for those trying to provide for their families themselves.

Public housing rents should at least reflect the total cost of providing the housing, & not be a drag on those providing for themselves.

Graham is right – by historical standards current interest rates are not especially high, and in “real” terms (adjusting for inflation) they are significantly negative. The RBA may have reacted to emerging inflation too late, and in hindsight Lowe was wrong to suggest that rates would not rise until 2024 (though if you look at what he actually said, it was not a firm prediction and was hedged with caveats). But it had little choice but to do what it has done. And with government policy remaining significantly expansionary – both in its stated objective to raise wages growth and in persistent budget deficits and big spending promises – interest rates may need to stay higher for longer if inflation is to be tamed.