welth4life, people can take a alot more stress than 1% if increases are gradual. They will change there's jobs' seeking more money, will reduce number of holidays per year and barrow $$$ from parents…. Unless it will be sharp rise in CR, people will tolerate more or less comfortably 2-3% if speared in few years.
RBA working very hard not to stress the people with CR. Gradually rising CR you can get more 'juice" out.
But since a lot of people are overcommited already, the default rate will be rising proportionally with the rise of CR.

Qlds007,
When you deal with any professionals some are more switched on and creative than others.
I remember seen one accountant that stated that i owe ato 5K. So i went to the other (recommended) and actually got 3-4K back from ato.
So, even they all governed by the same regulations, the result can be remarkably different.
Just my 2c

Isn't it fascinating to watch how interest keeps going up in 25 point steps every 3-4 months. The interesting part is that disregarding  interest rises credit card debt keeps going up, people keep buying housing at inflated cost, store accounts keep growing up and Retrovision type shops reporting sky high profits together with sales of new luxury cars going up.

I feel like I been left out, do people know something I don't or they earn x2 or x3 time what i make ….
I am not too far away from 100K p/a.

we have 2 CC, use one as 6 months interest free while money working in the PPOR loan and live on 30 day account on second card. We have not paid 1c in interest on CC's for about 5 years now. Will drop one card off in 6 months – I am in

 -33, hm, we better start investing !
On the other hand, i do not think I will ever retire unless due to sickness ….
 

I would say next 4 months:
1. One more 25 point correction by RBA
2. Labor party to rule
3.Real estate prising to flatten (generally)
4. Rent to keep creeping up

I am 30,
we have PPOR purchased 4 years ago. Owe 20% of market value. We have plenty of disposable income (me + wife) but sinking it all in PPOR. Will pay out in 12 months. Still live without furniture and TV Want to be debt free when / if real estate market burst. This way we will be able to snap good deal paying cash and not be effected by high interest rate

Comparing to what our company pay general factory laborers i do not see how people can support the loans if interest to go up. Not to mention that guys have loans and drive $50K cars ( borrowed money) and this is all on $40K wage.
Attitude is wrong, it will burst somewhere as situation is not sustainable.

Brisbane / Bayside – selling quick. Prices indicate steady trend up. Anything under 400K sold quick however top properties 1M+ seem to sit for sale for some time…
Reno suitable properties go very quick …

Agree with foundation, , Freedom = ZERO debt. Too many play to close, how many people you know who say “I own 3 houses”, they do not, bank own them. How many say “ I have new BMW”, they don’t, they just kidding themselves, finance company own it.

The company I work for has owner with mind set like foundation. In last 15 years some of our opposition went down as industry fluctuated and they had no money to support the Business. Same story, new cars on lease, bank loans, renting buildings … and so on. But we survive and grown as we could sustain 2 years of low profit seasons we had no loans, business OWN everything. So our expenses where minimal.

It is all about your financial exposure and how defensive is your strategy. History indicates that you got to be careful, debt is your enemy. Take every opportunity to keep it down, always consider “worse case scenario” but be positive!

Just thinking aloud here… no offense meant

jamiedellam

I have dome some calcs some time back, according to what I got back then, you plan is sound. The only difference in my calculations was that you should buy one IP pay it out completely, and then purchase second and so on. One step at the time. With your deposit you should be able to jump first 1-2 steps.

Basically I was getting picture on the paper that paying IP’s one by one is better dollar wise due to huge savings in interest. As if you take 3-4 loans at the same time your exposure to interest is much higher.

Got to remember to adjust my calculations to individual specifics like tax, and so on….

Try calculating this scenario and see what you get.

Exercise 1 : you own PPoR and purchase IP. Pay it out and purchase second, pay it out and purchase third and so on. See what you will OWN in 7 year $$$

Exercise 2. : you own PPoR and purchase 4 x IP’s and keep purchasing using grooving equity .   See what you will OWN in 7 years $$$