2 Weeks ago I told you HERE, how, in the 1973 Oil Shock, oil prices went from $4 to $12 in 18 months and what effect that had on inflation, mortgage rates and how Sydney and Melbourne house prices went up significantly.

Then last week I told you HERE, how the 1978 oil shock was a bit messier when it came to house prices.

Mortgage rates climbed from around 10% in 1978 to 17.5% in 1990, rising steadily the entire 12 years (!), along with sustained high single digit inflation, before finally peaking.

Sydney property price growth ranged from -5.6% to 26% in this period and everything in between, with rising mortgage rates not stopping high growth rates at times.

One thing I want to mention is that in the 1970s, whilst we dont have exact matching data, the percentage of income the average person with an average mortgage spent on that mortgage was 10-20%. In 1990, at peak 17% interest rates, this number peaked at around 30%. In 2025, this number had grown to more like 40-50%. We, as a nation of property owners with a mortgage, are spending way more of our total income on our mortgage now than in the 1970s. Mortgage burden has tripled relative to income since the 1970s. This means there is less room for house prices to dramatically increase in my opinion. There is just too much stress in the system.

See the attached spreadsheet if you want to check it all out.

So what as a home owner and property investor, should you be doing now?

In the space of a few months, not only is the entire world political order changing, but so is each individual property market. Its more important than ever to ensure that you are buying quality properties in quality areas with above market growth. And equally important avoiding lower quality areas that may see no growth over the next 3-5 years.

As a home owner:

• check you are on a competitive rate;

• consider managing risk with some of your loan fixed;

• consider building up your offset account for a buffer;

• check your structure - have you adequately quarantined debt used for investment/business purposes? You could be savings thousands.

Click Here if you need help and lets chat.

Anecdotally, re locations, my buyers agent contacts are telling me that they are beginning to be priced out of Brisbane and now looking more at certain areas of Melbourne for investment returns. Of course, if you are looking for home where you live, this doesnt matter too much to you, but within any crisis and tricky market, there are always pockets of growth.

I worked in financial markets for decades, I saw people in these times create life changing wealth when others hid. These difficult times are the times to step up and get strategic about your investments and come out the other side better off. Dont stick your head in the sand.