Those of you that are loaded up with leverage better pray rates don't breach 10%. I suspect those who are constantly motivated to ramp housing on this site are fuelled by fear and self doubt. Either the RBA allows inflation to get out of contorl or it does the right thing and raises rates for the long term benefit of the economy as a whole.
The last time rates here went over 10% home owners were set up with mortgages that were geared to only one wage, so there was no collapse of the housing market, just 10 years of stagnant growth. Now that rates are historically low house prices have realistically gotten away from normal society. If rates were high and house prices are where they are now then I'd say that the prices are sustainable. But that's not the case and many would be in danger of defaulting when rates do go over 10%.
Our dollar has reversed its trend and could hit the 60s once again - if that does occur then inflation here for food, clothing, fuel and overseas funding would skyrocket. Once that's set in stone then it's light out for sub 10% rates for possibly over 10 years! The economy could fail all it likes but while inflation is high they will be backed into a corner to keep rates high. Only by doing so can the economy can undo the wrong doings.
