Like what you've read?

On Line Opinion is the only Australian site where you get all sides of the story. We don't
charge, but we need your support. Here’s how you can help.

  • Advertise

    We have a monthly audience of 70,000 and advertising packages from $200 a month.

  • Volunteer

    We always need commissioning editors and sub-editors.

  • Contribute

    Got something to say? Submit an essay.


 The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
On Line Opinion logo ON LINE OPINION - Australia's e-journal of social and political debate

Subscribe!
Subscribe





On Line Opinion is a not-for-profit publication and relies on the generosity of its sponsors, editors and contributors. If you would like to help, contact us.
___________

Syndicate
RSS/XML


RSS 2.0

Howard earns interest on rates

By Graham Young - posted Friday, 28 September 2007


In the last election Howard’s promise that interest rates would always be lower under the Liberals than Labor may have been crucial to him holding mortgage belt seats.

My colleague John Black found no statistical relationship between the swings that actually occurred and average mortgage sizes, but he found a relationship in other seats. His theory was that the interest rate issue didn’t so much affect those who were buying houses, as it affected people, like their parents, who worried about the home buyers. Our questions aimed to test these hypotheses.

We also wanted to know how real "mortgage stress" is. Are those who spend more than 30 per cent of their income on mortgages rich enough to afford it, gearing into investments, or desperately hanging on to a toe-hold in the housing market?

Advertisement

Last, we wanted to know whether voters blame Howard for high interest rates and whether nervousness about them made him more or less attractive to voters.

Our sample swings to the left, and compared to the average is older, slightly richer and more likely to own a home, and 27 per cent of those with mortgages were making payments putting them in "housing stress". Despite being more affluent than average they gave us valuable leads on these questions.

Interest rates were a significant issue for all groups, except for those renting. Just more than a third of renters thought it was a significant issue, and about the same percentage thought it wasn’t. For those with a mortgage the figures were 54 per cent and 17 per cent, while for those who owned outright they were 41 per cent and 29 per cent.

If you were paying more than 30 per cent of your family income in rent, then the figures were 65 per cent significant, 11 per cent insignificant. Safe to say that even if these respondents have bought boats, holiday homes and investments they’re still worried about the holding costs.

There wasn’t much altruism evident. When we coded qualitative responses from swingers, 23 per cent of them came up with a variant of "I’m alright Jack" while 21 per cent said "I’m suffering", or words to that effect. Eleven per cent were primarily worried about the effects on people other than themselves. These were mostly aged between 55 and 64, the age when you are most likely to have offspring buying a house. Another 6 per cent actually saw a personal benefit in higher interest rates, and were also generally older, so were probably net lenders.

A problem for Howard is that 11 per cent of swingers volunteered that governments had no effect on interest rates, and a further 6 per cent said it was a significant issue because he had lied about them last election. "… I believe the Liberal Party will again lie and claim they'll keep interest rates low, or lower, or at record lows (pick this week's lie)."

Advertisement

We also looked at those in mortgage stress and the personal impact was overwhelming - 47 per cent were personally suffering. But only 8 per cent nominated coalition lies. It seems that while mortgages are hurting, the government isn’t necessarily being blamed.

So, who is more likely to keep interest rates lower? The answer to this was fascinating. 80 per cent of Coalition voters nominated the government, but Labor voters had no confidence in their own side with only 13 per cent nominating them as the best. The apparent discrepancy is made up by those who believe neither side has an edge with 69 per cent of Labor voters calling it a draw, compared to only 15 per cent of Coalition voters.

A closer look at swinging voters makes this better for the government. Those voters who have crossed to Labor believe that Labor is better able to handle interest rates than the Coalition, by 21 per cent to 7 per cent, but those who are unsure, or moving from Labor to Coalition more strongly nominate the Coalition over Labor. So, while "Neither", a neutral position, is the answer for 50 per cent of swingers, a quarter tend in the government’s direction as a result of interest rates.

  1. Pages:
  2. Page 1
  3. 2
  4. All

First published in What the people want on September 23, 2007.



Discuss in our Forums

See what other readers are saying about this article!

Click here to read & post comments.

10 posts so far.

Share this:
reddit this reddit thisbookmark with del.icio.us Del.icio.usdigg thisseed newsvineSeed NewsvineStumbleUpon StumbleUponsubmit to propellerkwoff it

About the Author

Graham Young is chief editor and the publisher of On Line Opinion. He is executive director of the Australian Institute for Progress, an Australian think tank based in Brisbane, and the publisher of On Line Opinion.

Other articles by this Author

All articles by Graham Young

Creative Commons LicenseThis work is licensed under a Creative Commons License.

Photo of Graham Young
Article Tools
Comment 10 comments
Print Printable version
Subscribe Subscribe
Email Email a friend
Advertisement

About Us Search Discuss Feedback Legals Privacy