The Real Story Of Mortgage Stress

[@innoccente1]

Austrália built a nice trap for itself. A real estate bubble that can never be deflated under penalty of economic catastrophe!

[@WalkTheWorldDFA]

Correct, a double bind. Solution is more debt, for ever, until its not....

[@muzzmac160]

But eventually a weak point in the bubble pops in catastrophic manner.

[@tobiuslarone]

All comes down to what other countries do. They've all amassed ridiculous debts and so it's become the new normal. We in Aus missed an opportunity to spend all that capital wasted during the pandemic on green infrastructure to power Asia. Meanwhile Scomo sits there wondering why people don't like coal anymore (I still don't think he gets it!).. Shame our leaders are so backward. A bit of progressive leadership and this country could be epic.

[@nickg1789]

...but the public don't either know or care about it. I just don't understand 🤔 why people are not asking how and why this has been allowed to happen!

[@leightonsummerville1236]

@@muzzmac160 And i bet the first head lines coming out from main stream media is, no one seen it coming.

[@redsed1565]

ITs all plain to see now Marty! Take a Holiday!

[@d23wilson]

Martin, what a great video. Almost like a rant, but a controlled release of data and knowledge and wisdom. I have been watching your channel for 2-3 years now religiously. You have always remained true to your beliefs, your understanding of the fundamentals..and those fundamentals being a combination of human psyche, human behaviour intertwined with economic reasoning, and never deluded yourself into economic models (which is ridiculous, but a requirement if that is your job to try and model the most unhinged and emotional creature on earth). It just amazes me that you still pretty much stand alone in MSM, but of course have a loyal following. I would say i am a fan in the truest sense..i am fanatical to your work. I completely agree that both political parties will offer the same, as it is so deep down ingrained into the Australian way of life…govt the owner of the Australian currency has allowed the banks to lend too much in order to: create a wealth effect, and keep tradies employed (keeping their unions in work and out of the news). And with that approach we have seen that the govt and the RBA have then, to ensure Australians sovereignty print up money to ensure we have the cash flow to pay off external creditors in case of them calling their debts…all this based on the models of the US, who have abuse their reserve currency position. We cannot work off this model, but yet the American culture that came to australia in the 1990’s and took over what with their basketball (Michael Jordan and the bulls), to Hollywood hype, and gangster rap..hehe. But this path they have taken just ensures the govt, the banks, the RBA are all entwined into this American model where value will always rise and therefore money can be printed into existence now to overcome short term stress. Never understanding that human behaviour will fundamentally change with this too. And it has as your surveys suggest, people are in stress but are very hopeful. I think what you uncover here is a strong case of “keeping up with the joneses”…purchasing and consuming of high cost products, land, housing, European cars. There is financial stress that is there, but that is soothed every time they hop into their mercedes, or they venture into one of their entertainment rooms. It is true and proper disavowment, not denial.(oh, its not happening to me), its disavowment (that is behind a wall, I cannot see it…it does not exist). So, with all these institutions (govt, Banks the 2 combined issuing so much aus currency, and then the RBA coming into print up enough to provide reserves to ensure we have enough money to flood in case of pay back requirements)….and a voting public who are in step with the housing and the luxury products from countries who know nothing other than to export…for me, we are all lock step in denial…which means that only externals can enforce reality. Now throw in ScoMo who is stupid enough to pick a fight with our largest customer, and them being a customer of the MOST low tech products any can product, ie dirt dug up…then how do you think we will fare in to the future? An analogy, we are wearing outer clothes with threads hanging loose….we have no under clothes/garments on…once someone picks that thread we will simply be naked, and all other countries/Allies even will say how stupid were you to wear such ratty clothes with no underwear. You are now naked and silly, and you kind of deserve it. No, we will not rescue you, we will offer you a paltry discount or time period of grace to pay, but you shall get yourself out of the mess of your own making. Ie, the Australian dollar…that abused by the govt and their franchise “pillars of society” (who pimped themselves out to mortgage brokers/street sellers) ie the banks, and the RBA only suggests to print up enough reserves to ensure no one can fail internally nor externally….EVERYONE is deluding themselves, then surely its only the external creditors that will ensure reality stays consistent. Indeed its you martin :) another country/ies in your form who understand what is happening here that will enforce this retake of reality to be the new norm for Australians. Everyone looking for the Hollywood blockbuster disaster, day in day out, and going “HA?” When another day passes by without the nightly news crying “DISASTER”…but this, situation, goes back to the Asian proverbs….we are gin to be living in most interesting times, AND, this part is already happening, this is a death by a thousand cuts. It is slow and painful and eventually the psyche wears out only to realise that the last 20-30 years of this type of behaviour has led them to the inevitable. I wondered for so long how long the lies could go on, and it truly seems like a 2 generation period. But i feel very confident now it is all unravelling, there are no creative ways out of this other than to face the consequences. Shut up and be productive.. I do love quotes, and a good one from Ayn Rand seems appropriate: My philosophy, in essence, is the concept of man as a heroic being, with his own happiness as the moral purpose of his life, with productive achievement as his noblest activity, and reason as his only absolute Maybe on the horizon is more humility in what to achieve in life is nothing other than finding your own happiness, ie not chasing book authors on how to be successful, earn a squillion, and to hone your skills in your progression, not leave them after you have just learnt them to become a “manager/leader”…and these philiosophies, hopefully mantra’s could see us become the humble country, not the lucky country.

[@aysinduarte]

Thank you Martin for defining stress. It's bandied about constantly online with no explanation.

[@WalkTheWorldDFA]

Absolutely

[@SAMW557]

You really are the canary in the coal mine - thx mate.

[@rrssmooth6643]

Those charts look absolutely devastating.

[@rupertmurchie8155]

Appreciate the work you and your associates do Martin

[@Chris-by8eh]

As always, love your work Martin

[@kelvinjames6344]

Don't borrow more than you can afford to repay you have to factor in emergency

[@tobiuslarone]

You should tell all those first time house buyers in Sydney from the last year.

[@calibre_au6183]

Most aren't interested or able to repay the principal, they're purely servicing the loan. What a bad way to live, one job loss away from losing the lot. Australia has been kicking the can down the road for too long. With interest rates now at rock bottom we've run out of road.

[@astridaiko]

Some very good points you brought up Martin. I think we're digging a hole for ourselves too, and it's getting deeper at an ever increasing rate!

[@WalkTheWorldDFA]

Absolutely

[@davegallo8790]

Another BRILLIANT video of content, Martin. Well done and thanks. Your data and analysis is much appreciated. This madness (the everything debt bubble) can't go on forever! Something will have to give! Hold on to your hats people. It's going to be a wild ride!

[@WalkTheWorldDFA]

Much appreciated

[@jimmycook872]

The Perfect Storm. LOL

[@zacnat12]

20 years of stress and a mortgage. Sold the house at the height of the market and bought outright a townhouse. A whole new life ahead.

[@xchazz86]

Well done, life's too short to be spent on housing manipulation/speculation, money better spend actually living.

[@lester1517]

as always great work , thanks

[@WalkTheWorldDFA]

Our pleasure!

[@AussieJenn]

Struggling homebuyers are getting a raw deal with (as you pointed out) flat salaries at the moment. Employers have profited from the Government handouts and ripped off their employees (Making them use their holiday leave). It would be very stressful to work part-time or casual.

[@stevef.m.2188]

Thanks Martin

[@Chris-by8eh]

Martin: i love your COMMON sense with mortgages and having no saving left over. And that is not very common these days. The spend everything now. and don't save at all. Lots of wisdom, and I TOTALLY agree with you 100%. Just cos it's the flavor of the month does not mean it is right.

[@Kimber-bz9fe]

Well surely with all this financial stress defaults will rise will they not which should indirectly correct prices / fall. Excellent & thank you Martin your simply the best! 😊❤️

[@WalkTheWorldDFA]

Thanks - a slow grind for many I fear...

[@Kimber-bz9fe]

@@WalkTheWorldDFA yes agreed

[@Chris-by8eh]

that would be a great metric "% of listings increase/decease from last month or survey"

[@neville132bbk]

Welcome back...from Levin NZ..,.... haven't seen you online for many weeks. Here the housing situation is like a weather balloon....and we know what happens to them.

[@inflationistransitory]

Ok, So if we see household stress numbers decline rapidly at the same time as housing sales stock increases - it’s nottt a good sign, it could mean undisclosed forced sales and the tipping point

[@davidpearn4344]

Totally agree with you Martin it's not going to end well

[@H0LDENSUX]

It would be interesting to see the 40% increase of the mortgage stress in NSW over lap another chart with the increase in prison population lead by politicians with no business background to see how inter related debt, crime and political ineptitude all tie into Klaus Schwab's statement "you'll own nothing and be happy."

[@laszlon.4424]

Brace for volatility, Government is hoping to kick the can past the next election & want to inflate their debts away(inflation), Banks/equities can't let property prices contract, workers wages are stagnant, bond market & Central Banks are looking at serious rate increases. Is everyone maxed out on debt -a Minsky moment. Prepare accordingly.

[@2010xr50]

I’d assume mortgage stress is seasonal, I.e. post Christmas. For me I have Christmas hang over, plus bills such as rates, registration, house & car insurance etc. Post Early March, I get a 5mth period where bills are standard such as gas, electricity, water etc which is easy.

[@WalkTheWorldDFA]

More structural than seasonal.

[@2010xr50]

@@WalkTheWorldDFA fair call. Was more curious if the people surveyed would provide a different view pending when you ask is all

[@kelvinjames6344]

If you borrow to much and can't repay that's your responsibility

[@motorheadbeany1903]

In a true free market that is correct. But in these times government will do everything to protect overleveraged and punish savers.

[@tb8283]

Hi Martin - Not sure if you saw the article today about builder's trying to get out of fixed price contracts. What a farce.

[@WalkTheWorldDFA]

Oh yes, crazy. But many have small print which allows for increased input costs....

[@stevej3483]

it will be interesting to see if the omicron surge and supply disruptions will cause any lay offs

[@WalkTheWorldDFA]

Already happening.

[@Kimber-bz9fe]

Nawww the dogs are barking! Hurry up Dad & takes us for a walk!!!! 🤩🐕

[@darryl1617]

It seems that this debt ponzie scheme can go in for a very long time. As long as house prices go up faster than the interest rates….. God help us if the property market goes down like in the US in 2007/08. If rates go up market might go down. I cannot see how rates can go down though, so we are getting closer to a bad scenario. I’m ever the pessimist though so don’t listen to me.

[@davidrobinson3348]

Martin. I have heard you point out that your Investor Stress is marked against the residential post code of the investor, but can you explain why you do it that way and not against the post code of the investment property. Thanks

[@frasersamuel2867]

I suspect your figures on stress are far too low. People are often deluded about their finances. My gf spends heaps on horses & is always struggling but I doubt she would tell you. She won't be able to pay her mortgage if rates go up

[@WalkTheWorldDFA]

The renter is where the property for rent is. The investor is their residential post code, though I also know where the investment property is so actually I track both.

[@antpoo]

Let them rent

[@Eve_Marian]

Why hasn't the property market crashed yet? It's been predicted for years now.

[@grizzz6884]

the fed printing 30 billion a month

[@tobiuslarone]

Because the government doesn't want the banks to go to the wall and cause an Aussie melt down. They would literally get the rba to start buying houses on their balance sheet before allowing the housing prices to tumble significantly.

[@kssatta4107]

Everyone kno they are printing but how much they can print 💵 & how high house price can go????

[@leightonsummerville1236]

@@grizzz6884 That was 120bil a month, maybe even weekly. It was truly insane, they printed 20%+ of all money created in the USA history in 1 year. correct me if I'm wrong, it was 4 billion a week in Australia.

[@grizzz6884]

@@leightonsummerville1236 you are correct , t man printed 7 trillion in a week to bail out the repo market . in sep 2019

[@neville132bbk]

NZ has certainly"got it" ...re 26:40... with a vengeance All the issues like banking policies, land supply, dire shortage of tradesmen and supply chain problems interplay to make it constantly bubbling pot. This regional town of 20 000+ is planned to increase by over 50% in less than a generation...housing in Wellington is just too far out of $$reach and this area on the growing motorway north has seen a once retirement region getting seriously expensive. Cost of housing in Wellington is affecting school rolls and the ability of many schools to keep staff much less attract new and young teachers.

[@richardminhle]

My household saves 70% of our income (Jobs and investment). We are still renting and we sleep like babies at night.

[@rohanjones7238]

Couple of points ! First supposed to be all way ahead in our mortgages….. I’m not 🙄 ..Second if interest rates are lifted for inflation and therefore mortgage costs rise related to bloated house prices will this create higher inflation and therefore higher interest rates roundabout ?

[@rupertmurchie8155]

I doubt that will cause greater inflation, in NZ house purchases aren't part of the CPI although rent is, also increase in mortgage repayments will be less discretionary spending so possibly a negative affect on inflation.

[@wapphigh5250]

yep the standard of living in the country is falling due to deteriorating productivity over the years and wasteful government spending. The drift to socialism in Australia has solved nothing. It's made it worse.

[@bencubus1814]

Looking forward to your election commentary Martin. I'm hoping to all hopes that Australia has learned from the last 3 years and are in turn more scrupulous with their votes. That's one fundamental (and probably the easiest to achieve) component to solving our problems. Buuuuuuuuuut I won't hold my breath.

[@plucka9999]

Seems like a flawed spreadsheet. You're just adding total households with mortgage, rental, investor stress together to arrive at a total, whereas in reality a lot of households would be under more than 1 type of stress at the same time, therefore you are counting these household twice or more and the real numbers would be much lower. EG a Household might be under mortgage and investor stress, you've counted this as 2 households instead of one.

[@WalkTheWorldDFA]

No, not flawed, but same household can appear in more than one column. The Financial stress unscrambles any suych issues, as its appropriately weighted.

[@tobiuslarone]

First