At wit’s end: rent protections and rate rises double whammy on families

Sandra Di Palma’s first thought after hearing news of the rate rise was to move out of Sydney.

Sandra Di Palma and seven-month-old Hugo at their inner-west Croydon Park home in Sydney on Tuesday. Picture: Noah Yim

When she heard news of the Reserve Bank’s rate rise, Sandra Di Palma immediately thought of leaving Sydney with her young family.

She and her husband are at their wit’s end: with both their properties set to come off fixed rate mortgages soon and rising childcare costs for their children, the family of four may have to make the tough decision to move away from their extended family so as to make ends meet.

This would mean they’d have to sell their unit at a loss. It is already negatively geared and with a possible expansion to renters’ protection indicated by the government, Ms Di Palma and her husband could sink deeper into the red if they are not be able to pass on higher mortgage repayments to tenants.

“The rates will force our hand and we’ll end up leaving Sydney to ease the financial pressure,” Ms Di Palma said, as her father took care of seven-month-old Hugo and his older cousin nearby. “Our mortgage payments will go up over $1000 a month. It’s not very good news this afternoon – very, very disappointing,” she said.

Problems are multiplying for Ms Di Palma, a part-time event manager, and her husband, who works in reinsurance. Daycare costs for their three-year-old are already higher than expected and they’ll soon have to cough up more daycare costs for Hugo.

Since their inner-west Croydon Park duplex is too small for the children, they’re also looking to get a bigger home somewhere else. Buying a bigger home near the city is out of their means but renting is also very expensive.

“Rent prices are so high that moving to another location, it’s just financially not possible unless one of us earns more money,” Ms Di Palma said.

“I’m on realestate.com.au multiple times a day just going like, what properties have come up to buy in this area, or in the Blue Mountains?”

They’re looking to sell their apartment at a loss compared to the price they paid in 2017. It is losing money and the problem will only worsen once the apartment and Croydon Park home come off fixed rates.

“It’s been a bit of a headache,” Ms Di Palma said. “During Covid, the tenant at the time wasn’t paying us rent for a few months because she didn’t have any work. There was nothing we could do,” she said. “Then we had to decrease the rent to attract new tenants.”

She has only now raised the rent back to what it was three years ago. This all comes on top of cost-cutting for the family.

“Just by our circumstance of having two kids, we don’t go out much, which helps a lot,” she said. “But you know, we don’t go on the holidays that we’d like to go on. Things – you know – those recreational things become more limited.”