4. Household debt

Debt level comparison 1990 - today

Although comprehensive data on household debt was not readily available until the late 1990s, according to data from the Reserve Bank of Australia (RBA), household debt in Australia has risen significantly since the 1980s. In the early 1980’s household debt as a percentage of disposable income was around 40%, in the late 1980s, it was 60%, whereas by 2021, it had risen to over 190%. This increase has been driven by factors such as rising property prices, increased borrowing for investment purposes, and the growth of consumer credit with relaxed banking policies and off balance sheet sales of mortgage lending in the RMBS markets causing a derivative bubble. The major factor being the 3-decade period of linear reduction of cash rate averages in the boom, boom, bust cycle. https://www.rba.gov.au/chart-pack/household-sector.html

No one is better off in this environment. Even the renters of this country aren’t any better off and are living in the most stressful time in generations. https://www.savvy.com.au/2-72-million-australians-at-risk-of-rental-stress-survey/