WHILE the interest rate rise ('$200 a month', Newcastle Herald 8/6) was always going to be happening, the exposure of many first home buyers to this and future rises, that will also be expected as the Reserve Bank of Australia (RBA) seeks to manage interest rates with the blunt instrument of interest rate rises, will cause some real financial strain some may not be able to endure.
The use of low deposits to get first home buyers into the market was always fraught with real dangers. If these first home buyers go under, then there is little that the following fire sale will do for them as the loan with charges can almost exceed the then market value of the home.
