PHOTO: Maddie Walton. Yahoo
When Maddie Walton purchased her three-bedroom home in Queensland in 2021, her mortgage repayments were $550 a week. Now, at 26, her repayments have soared to over $1000.
“I love my home, but hindsight is always 20/20,” she told news.com.au. “I bought for much more than I should have.”
Ms. Walton bought the property for $691,000 with a 10% deposit, sinking around $125,000 into the purchase. However, after paying a buyer’s agent and other hidden costs, she ended up with only 10% equity in her home. Four years later, she still owes $600,000 on her mortgage, with weekly repayments now at $1000. Fortunately, two housemates contribute $600, leaving her responsible for $400 a week.
At the time of purchase, Maddie was working in medical research and had a partner to share the costs. The original $550 mortgage was manageable, and she wasn’t stressed about the repayments. However, after her partner left three months later, and as interest rates climbed, the situation became more challenging. Maddie decided not to increase her friend’s rent despite the rising rates, which only added to her financial stress.
“There were times I questioned whether it was worth it,” she admitted, “but ultimately, I believe it is. For me, the property is a long-term strategy.”
Maddie owns a three-bedroom home. Picture: Supplied
She owes around $600,000 on her mortgage. Picture: Supplied
During this period, Ms. Walton also made a significant career change, switching from medical research to become a mortgage broker after a frustrating experience with seven different brokers during her home-buying process. She felt they weren’t asking the right questions or advising her on how much she should borrow.
“I don’t want other young people to go through the financial pain I experienced,” she said, explaining her decision to become a broker who focuses on making sure her clients don’t overextend themselves financially.
Now running her own business, MoneyLounge, Ms. Walton advises her clients to “practice having a mortgage” before they actually get one. She encourages them to live on what would remain if they borrowed the maximum amount they’re considering, to see if it’s sustainable.
“I want to make sure my clients don’t end up stressed, anxious, or miserable,” she said. “Buying a house is great, but if you overextend and have to overhaul your lifestyle, it’s not worth it.”
Ms. Walton emphasizes the importance of factoring in all costs, such as council and water rates, alongside mortgage repayments, to avoid financial strain.
According to financial comparison website Finder, 41% of Australian homeowners struggled to pay their mortgages in July 2024. Graham Cooke, a financial expert, also noted that housing costs in Australia have become the leading source of financial stress, urging people to consider moving in with family or friends to ease the burden.
SOURCE: NEWS.COM.AU