Woman forced to work 60-hour week as cost of living crisis and rent rises collide

A Sydney woman admitted she now works 24 hours to cope with the crippling double whammy of a huge increase in her rent and rising cost of living.

The rent for her Zetland share house in Sydney’s city center will increase from 0 to 00 a week, forcing her to work 60 hours a week to make ends meet.

She is one of many Australians feeling the full impact of eight months of rate hikes by the Reserve Bank, regardless of whether they rent or own their own home.

The RBA has raised the cash rate by 3.0 percent since April to reach its highest level in a decade.

The increases have caused mortgage payments to rise by hundreds of dollars and rents to soar as homeowners pass the interest rate increase on to their tenants.

Ms Barber said the increase has caused a lot of stress at home as the cost of living continues to rise.

“We are very nervous about what our future could be like, we don’t know if we will be able to stay in this house,” he said.

Ms Barber has been forced to get a job in hospitality on top of her full-time marketing job just to make ends meet, saying it’s what she has to do to “take care of myself and my future.” .

The Sydneysider works 40 hours a week in his marketing role and has taken on another 20 hours of bar work.

“I’m not willing to stretch my full-time job into a potentially 60-hour workweek, that’s a lot,” she said.

“But ultimately, it’s what I need to do to survive and financially sustain myself in my life.

“It feels like a step back because I’ve been working professionally for five years…I have a degree and I should be able to support myself with a full-time job that requires a degree, but that’s not the case.” .’

Ms Barber is one of millions of Australians, mortgage holders and renters alike, facing rising costs thanks to inflation and RBA rate hikes.

MORTGAGE INCREASES

Mortgage holders are on the front lines every time the RBA announces another hike, weathering the storm of eight months of interest rate hikes.

Those with a $500,000 loan will pay an additional $834 each month than they did in May when the rate hikes began.

That number increases to $1,668 per month for a $1 million loan and $2,501 for those with a $1.5 million mortgage.

The mortgage burden has reached 177.5 percent of disposable income, and now households are at greater risk of becoming overburdened due to mortgage liability, according to the Mastercard Economics Institute.

There are also warnings from Treasurer Jim Chalmers that the worst is yet to come for mortgage holders.

“The full impact of these interest rate hikes from our own independent central bank is obviously still being felt, and the magnitude of that impact and the timing of that impact are still uncertain in many ways,” Chalmers said after the latest rate hike. RBA. hike.

The Coalition has said that more than three million families with a mortgage are feeling the pinch of persistent rate hikes, and Shadow Treasurer Angus Taylor has said this holiday period will be difficult.

“We know that it takes a while for rate hikes to reach mortgage holders and these constant increases will add more pressure to household budgets already under pressure from rising costs of groceries, fuel and energy bills. “, said.

“Many Australian families will be struggling this Christmas and the pain will only deepen in the new year with thousands of fixed rate loans due to roll over from February.”

RENT INCREASES

Despite not having to pay back a home loan, renters are also facing large increases in their living expenses, with rents up 10.3% in the past year, according to the PropTrack Market Insight report.

Economists have warned that rising interest rates are being passed on to renters as mortgage holders struggle with each increase. Forty-two percent of all low-income renter households now face rental stress, according to the Rental Affordability Index.

Ms. Barber is facing a 17.5 percent increase in her weekly rent, or an increase of $150.

NCA NewsWire has also spoken with other tenants whose rents have skyrocketed 20 percent in a single increase, as well as others who have had two rent increases in the past year.

Property Club chairman Kevin Young warned earlier this week that the latest rate hike could be a ‘Christmas killer’ for renters facing increases.

“This rental situation is the worst I’ve seen in the 50 years I’ve spent in a property,” he said.

“Give renters some relief for Christmas because inflation can no longer be used as an excuse to raise interest rates.”

Sydneysiders like Ms Barber continue to bear the brunt, according to new data from Everybody’s Home, with rents in some parts of the city rising as much as $177 a week for the last three months.

Those living in western Sydney are paying an extra $118 a week in rent compared to a year ago, and rents on the lower north shore have increased by $275 or 36 per cent in the last 12 months.

In Brisbane, rents have risen as much as $67 a week in the last three months alone.

Those on CBD are paying $149 or 29.8 percent more than a year ago.

Perth rentals have also been hit hard, with prices rising by $124 per week or 23% for the north-west of the city and $107 or 22.2% in the CBD.

“Rents have risen long before interest rates rose, but each rate increase adds more pressure to an overheated and unaffordable housing market,” said Everbody’s Home CEO Maiy Azize.

‘Another interest rate increase means renters will be worse off if their landlord passes an increase. This will deepen housing stress for thousands of people.’

Low vacancy rates are also driving up prices and stressing tenants facing triple-digit rent increases.

The national vacancy rate now stands at 0.8 percent, the tightest market on record, compared with a vacancy rate of 1.

5 percent last year.

Adelaide has the lowest rate at 0.2 percent, followed by Perth at 0.

4 percent, while Sydney and Melbourne come in at 1.0 percent and 1.1 percent, respectively.

Despite the increase, Ms Barber says she would like to stay in her home, as finding another property would have to pay even more.

“I’m so afraid of having to go back to the rental market the way it is now, it’s pretty bleak,” Ms Barber said.

“We look at the market wondering what else is out there, but we would move to an even more expensive place for less value and incur the cost of moving on top of that.

‘The market is crazy. Inspections were booked as soon as they were released. I don’t think we really have a chance in the market.

SPENDING WITH CREDIT CARD

Meanwhile, inflation has also soared to new heights, hitting 7.3 percent in the September quarter, and economists forecast it will hit 8.0 percent by the end of the year.

There are worrying signs that Australians are turning to their credit cards to fight the high costs of inflation after the total household credit card bill rose by $86.6m to reach $16.89bn in October , according to RateCity.com.au.

There are warnings that Australians will continue to use their plastic to get through Christmas, and Canstar estimates that Australians will spend close to $57 billion in November and December on credit cards.

Canstar finance expert Steve Mickenbecker says the combination of higher spending and tighter budgets could add to credit card debt and rack up interest in the new year as many households feel the cost of living and the pinch total of eight increases in mortgage interest rates.

‘Christmas is the season of good cheer and goodwill, but it is also the season of big spending. Despite rising costs of living, mortgage payments and rents, Canstar expects another great season for retailers and record amounts on credit cards,” he said.

“The big issue is whether people can afford to rack up spending at the same rate as in the past, or whether they’ll end up with a debt hangover well into 2023 and maybe beyond.”