Relief and a little luxury if cuts occur

Ipswich homeowner Amber Warke has been watching her mortgage repayments go up since she bought her home in 2022, but this month she, like many Australians, is hoping for some relief in the form of an interest rate cut.

Miss Warke, a mother of two, bought her four-bedroom home in Ripley in February 2022, right before the Reserve Bank of Australia increased interest rates 13 times between May 2022 and November 2023.

“When I first applied for my home loan, the interest rate offered was 5 per cent,” she said.

“During the life of the loan, it increased to the highest rate of 6.29 per cent, and was recently dropped a few weeks ago to 6.04 per cent and then again to 5.79 per cent.

“From my application to its highest point, my minimum payment increased by approximately $450 per month.”

Miss Warke said an interest rate cut on May 20 would give her some financial breathing room.

“If my minimum repayments go down I’ll additional savings and I’ll be able to more successfully cover expenses such as utilities, rates and other bills,” she said.

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Amber Warke, pictured with Oliver the dog, is hoping for a rate cut to help with the cost of living. Picture: Lyndon Mechielsen

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“Loan repayment savings could also allow me to indulge in some luxuries for my family, rather than providing just the necessities.”

Ms Warke said while she was hoping to have a little more money in her pocket after the RBA’s next announcement, she was grateful she was able to buy a house when she did.

“If I had to try and purchase my home in today’s market, I honestly don’t think I’d be able to afford it,” she said.

“My current property has increased in value to approximately $875,000, compared to my purchase price of $680,000.

“I also built my first home in South Ripley in 2017 and sold it in October 2020 for $549,000. “There is no way I would be able to buy it back at that price now.”

Ms Warke said felt disappointed for future buyers if prices went up even more, but wouldn’t be surprised if they did.

“After what we saw post-Covid, it’s clear that when more people can buy, demand goes up — and in a competitive market, that usually means prices follow.”