– Let’s put it in good Western language: I don’t understand what they’re doing, it’s just madness, idiocy! It breaks both old and young alike, and not everyone has equal pay or that of a minister. I was nervous when I heard the central bank governor on Thursday.
This is what Justin Toft, 50, told Netavizhen about the announced interest rate increases.
On Thursday, the Bank of Norway came with a very unpleasant message to the country’s borrowers: the key rate will be raised by 0.25 percentage points, and there may be Seven more increases by the end of 2023.
Sberbank 1 Nord Nord is the first bank to announce this They will raise mortgage ratesIt’s just waiting for other banks to follow.
Tufte lives in Dale between Bergen and Voss and works as a scaffolding installer both offshore and on the ground. Last year he received 630,000 NOK and took out a 2.5 million NOK loan. She died worried about the economy moving forward.
– I’ve noticed already last year that the economy has gotten worse and tighter. So, I work both outside and on land, otherwise I wouldn’t have been able to manage the expenses, he says.
Toft says he has taken into account that interest rates could rise and create a temporary buffer, but there are also questions about how long he will run “to death.”
– So now I’m thinking of selling both a car and a mobile home. He says I can take a train to Bergen where I work.
The main task of the Bank of Norway is to maintain inflation in the economy, close to 2%. But in recent months, inflation has been close double the heightAs a result, among other things, fuel and electricity became much more expensive.
Norges Bank raises interest rates To ease price pressure in the economyyou have no understanding of that?
– No, we’re in ISO industry Among those who are at the bottom of the wage ladder. This will only worsen the daily financial life of me and other low-paid people. Although I work abroad, we do not have a million annual income as many think. Tafty predicts that moving forward will be difficult for me and many others.
– What do you fear most in the future, is it an increase in interest rates, electricity prices or gasoline prices?
– is to increase the interest rate, because I have two car loans, a mortgage, and a credit. I feel terrified.
In addition to a loan from a private bank, he has a municipal loan on the house. Here, the interest rate was raised last week from 1.3 per cent to 1.8 per cent, which is nonetheless a reasonable interest rate.
– But I think it is unreasonable for Norges to raise interest rates in the situation we are in and think this is the wrong time to do so. I could have understood if they had raised interest rates last year,
– I hope they come to their senses and don’t raise interest rates too much at once and stop at 1 percent, says the most appropriate. Norges Bank noted eight increases of 0.25 percentage points, one in each quarter this year and next.
Recent central bank governor Ida Waldenbach believes that most households have sufficient financial resources to withstand the announced increases.
Tufte says that if they were still home, he wouldn’t care. Then they would still have three incomes, because he did not stop working the land.
But Tufte lives in a house from 1957 which, despite the heat pump, requires between 22,000 and 23,000 kWh of annual electricity consumption. Confirms that it is economical with power, turns off all lights when it goes out and puts heating cables on 1.
– Last year I paid almost nothing for electricity, now I pay 2000-3000 kroner per month even though I am not at home. He says up to 4,500 crowns at worst.
Tafty estimates that he drives 20,000 kilometers a year, in part because he commutes 120 kilometers back and forth to Bergen. With a gasoline price of up to 27 kroner per liter, it can also be noted on the wallet.
In the future, I want to drive as little as possible and take the train, he says, which, like many other consumers, is also surprised by rising food prices.
– I somehow understand that the interest rate is going up, but I think they are coming at the wrong time. Now you have to save whether you want it or not.
– Are you afraid that you will now have to pounce on other things?
– Yes, I accept. I had planned to use the holiday money to renovate the bathroom, but I will likely have to put that on ice. Moreover, I had plans to take a motorhome to Northern Norway, but I would probably have to leave it on the shelf,
Tufte says it will prioritize building a reserve and paying loans.
don’t walk around
Helen Moe (39 years old) lives between Stokke and Sandefjord in Vestfold. She and her husband took out the same mortgage for eight years, but recently applied to borrow more of the house due to the tight economy.
The 39-year-old is a trained veterinarian, and the couple have a one-year-old daughter. Mo tells Netavizen that they have two incomes, even a man has three jobs.
– How would you describe their finances today?
– This is not acceptable. With the electricity costs we’ve been getting recently, they don’t recur every month. We live in an old, poorly insulated house on a small farm and have over 6000kr in electricity expenses per month. Only in the last month we reached 4500 kr.
We paid more for electricity in a few months than we did in a year. Everything is unpredictable, and electricity costs are very high. We’ve already cut consumption and have more blankets and quilts inside, Mo says.
The couple originally took out a NOK 2 million loan, which has now been repaid to NOK 1.75 million.
– What do you think about the fact that interest rates are raised when other fixed expenses increase?
– It seems very unreasonable.
– So you do not understand that the Norges Bank should raise interest rates now?
– No, I think it seems completely wrong when costs increase.
–Have you taken into account that the interest rate could rise by two percentage points?
– I didn’t even realize that there could be such an increase.
Moe says the 4 per cent interest rate will have a lot to say to them and will make the economy tougher than it already is. Norges defends itself by saying that most households have sufficient financial resources to withstand the announced increases. Faced with this statement, Mo replied:
– No, we don’t have it. I don’t know what to do if interest rates go up any further. My husband has three jobs, which is 130 percent. Last month he had two days off, and it was the weekend.
– I am at home until October, and my job was terminated due to Corona. Additionally, I work in a low paying profession. Being a veterinarian is one of the lowest-paid professions in the country, despite the fact that I have educational qualifications equivalent to a bachelor’s degree, Mo says.
She confirms that she enjoys her work a lot, and the couple even have animals on the farm
But the couple also owns two cars, a petrol car and a diesel car. Mo says the man drives his car every day, and they are completely dependent on the car. A one-year-old child goes to an open kindergarten, needs a car to see a doctor, it takes 6-7 minutes by car to get to the store.
There is no public transportation
There is no public transportation where we live, Mo says.
– Are you afraid now that you will have to cut the bones of other things?
– Yes, but I do not quite understand what we are going to take further. Fiber networks were recently added here, which we pay to get the job done quickly. We’ve upgraded a bit since we’ve had mobile broadband, but other than that I don’t see anything.
Moe says they saw the fiber network as an investment, because the network and coverage where they live is so poor. There is also not much difference in the monthly price of fiber and mobile broadband.
“I also think the fiber is a positive in the event of a future sale,” she says.
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