A young Australian was forced to sell his Xbox and iPad to pay off his mortgage after his interest rate soared.
Callum James, from Perth, bought his first home in 2020 while working at JB Hi-Fi.
At the time, he was earning between $70,000 and $80,000 and could comfortably afford mortgage payments of $1,300 a month.
But then his rate lock ended in July of last year, and his payments increased to $2,400, and he had trouble making payments.
James was forced to sell some of his possessions just to make the payments, and described it as one of the lowest times of his life.
He said that in 2020, his $80,000 salary was considered a “decent salary” when he bought his house, but in 2024 it was no longer enough.
‘A few years ago, $80,000 a year was a decent salary. Now it seems like you can’t even enjoy it in the slightest.
“You get $5,500 a month, of which $2,500, if you’re lucky, goes toward rent.
With interest rates rising, Callum James (pictured) was forced to sell his belongings just to keep up with mounting mortgage payments.
“So you have about $8,000 a month on food; that’s being pretty conservative with how grocery bills are these days.”
‘How is anyone supposed to survive on what used to be considered a decent salary?’
He said the cost of food and bills has increased so much that even earning $100,000 makes it difficult to get ahead financially.
He said that a few years ago, $80,000 was enough to live comfortably and provide a real opportunity to buy a home if you managed your finances wisely.
‘Nowadays, you don’t have enough money left to even consider it. If you raise a deposit, you’ll ruin your borrowing capacity.’
More Australians are feeling the squeeze amid rising bills, high food prices and mortgage stress.
Many revealed that they were also struggling to make ends meet.
‘Try making $54,000 on a mortgage, groceries, energy bill, internet bill, rates, water rates, home insurance, car insurance, fuel and regional rates in New Zealand. I would gladly win $80,000,” said one.
‘The government is so out of touch. “Politicians should try to live like this for three months, I bet they can’t,” added another.
Others offered suggestions on how to survive the cost of living crisis.
‘Live below your means, move in with a roommate. You adapt,’ said one.
“If you take home $5,500 a month and have $1,2000 left to spend, then you’re living beyond your means,” added a second.
The debate comes after Finder data revealed 47 per cent of Australians are struggling to pay their home loan amid relentless interest rate pressure.
That was the highest level since Finder began surveying Australians on this topic in May 2019.
About 16 per cent of mortgage holders have missed at least one payment in the last six months, while almost a third express concern about it.
Graham Cooke, head of consumer research at Finder, said Australian homeowners are on the brink of a financial crisis.
‘With emergency savings depleted and the RBA yet to signal significant rate cuts, many fear their livelihoods are at stake.
“Urgent help may be needed to avoid a wave of financial hardship.”