Deputy Prime Minister Barnaby Joyce has dished out a very blunt message to people worried about their mortgages ahead of the expected OCR hike this week, saying the vast majority of Australians are not stupid and would have planned for it in their budget.
The Reserve Bank of Australia was tipped to lift rates from the record low of 0.1% at its monthly board meeting today on the back of surging inflation rates.
In a New England event to announce a $600,000 funding to improve a sporting club on Monday, Joyce was asked about his message to homeowners who had taken out large sums of money due to record-low interest rates, to which he replied: “I would say that obviously, whenever you borrow money, you always have in mind that things, that rates go up and rates go down,” news.com.au reported.
“It’s a market. Interest rates were the lowest they were in recorded human history,” Joyce said. “Most people, a vast majority of Australians, are not stupid. They all remember when they were higher. They understand that they are lower and they plan in their budget and how they deal with that.”
Joyce also lashed out at Labor for its recently launched Help to Buy scheme that would help 10,000 Australians a year into homeownership through the government taking an equity share of 40%.
Labor said the scheme would mean a smaller deposit, smaller mortgage, and smaller mortgage repayments. But Joyce took issue with it being accessible to someone earning $89,999.99 but not someone on $90,000.01, the report said.
The offer is available to singles with incomes under $90,000 and couples with incomes under $120,000.
“So for a two-cent difference, we have the difference on whether the government is going to… buy 40% of the house for you. Now how on earth who defines that policy?” he said.
Joyce proposed instead that in place of a flat 40% equity share for everyone below that salary, the program should be staged similar to the tax system – for instance a 20% stake from the government for someone on a slightly higher wage like $100,000, news.com.au reported.
