Acceso usuarios
Australia has experienced significant rises in mortgage costs and sharp declines in housing affordability in the past decade, which corresponds with the introduction of the Goods and Services Tax (GST) in the nation in July 2000. To what extent the GST has impacted mortgage costs is our research question. Using the mortgage loan data of all banks operating in Australia, this study investigates and measures the changes of mortgage yield spreads in the pre- and post-GST periods. Results show the bank lenders significantly increased their mortgage charges in the post-GST periods and the rise in mortgage charges was not a one-off impact. The findings have important financial, economic and policy implications.
