On Tuesday night, I was interviewed by Sky News’ Sharri Markson where I explained how there are “three Australia’s right now, whereby two thirds of Australians are doing it tough, while one third – mostly older Australians that own their homes outright – are getting ahead financially.
Edited Transcript:
Sharri Markson:
Michelle Bullock’s press conference this afternoon spoke about how household consumption figures reflect the fact that many are doing it very tough. She also pointed to the tight rental market and she painted this picture of, I suppose, two sides of Australia.
She said some households are managing to save and are doing okay. But other families are taking out a second job.
She spoke about how they’re cutting back on discretionary items, even skipping medical appointments, because they are doing it so tough.
Leith van Onselen:
I’d say that we have three Australia’s right now.
Roughly one-third of Australia rents. They are doing it really tough because rental inflation is obviously super high because of this high immigration.
We have about one-third of Australians with owner-occupier mortgage. They are getting absolutely smashed by interest rates:
These groups are also getting hammered by rising income taxes:
Then you have one-third of Australians that own their homes outright. They tend to be older and they are actually laughing.
They are doing really well for themselves because they are getting really high investment returns, they are getting high interest earnings on their savings and they are spending.
Source: CBA
These people are not paying these high rents and high mortgages.
So, we really do have a sort of three-part Australia at the moment. Two-thirds are doing it tough and one-third is laughing all the way to the bank.
