How Australia's housing market spun out of control — and what we can do to fix it
www.abc.net.au
Margaret's property investment odyssey peaked at 40 properties. At the other end of the spectrum, first-home buyers Justin and Lana are accustomed to disappointment. So how do we solve Australia's housing affordability crisis?

Property investment is ingrained in the Australian psyche, but is it too easy to cast landlords as the villain in our housing crisis?

  • null_dot@lemmy.dbzer0.comEnglish
    10·
    1 day ago

    That’s not really how mortgages work.

    If your house is worth less than your mortgage the bank can’t just ask you to cough up. That’s absurd really.

    It’s just that if you sell you can’t settle the mortgage with the proceeds.

    • Taleya@aussie.zoneEnglish
      12·
      1 day ago

      Negative equity is absolutely a thing - and if a property with a 900k loan drops to 650,000 for example, then banks consider it a risk

      • null_dot@lemmy.dbzer0.comEnglish
        4·
        1 day ago

        I’m not disputing either of those points.

        banks start wanting you to close the gap between what you owe them, and what they can get if they take the house in lieu of payment.

        This is absolutely false.

        Some loans, “margin” loans, do work how you say and the bank will make a “margin call” asking the borrower to repsy a lump sum to reinstate the margin. However, this type of loan is not generally used to buy residential property.

      • Pregnenolone@lemmy.worldEnglish
        2·
        1 day ago

        They’re not saying it’s not a thing, just that banks don’t call in the mortgage just because you’re in negative equity. It’s a problem if you try to borrow more or refinance.