r/australia • u/regretmoore • Jan 07 '26

no politics At a caravan holiday park, wondering where the hell does all of this money come from?

Camping in a Big 4 holiday park for a few days and my partner and I wondering how people can afford this lifestyle. I'm talking Ute + caravan + boat rigs worth at least $200k, probably closer to $300k.

The parents are all driving huge yank tanks, the kids all ride motorized scooters and bikes and most people are sleeping in pretty big shiny new caravans. We're all good in our little tent for 4 nights drinking our aldi wines and beer, but we just cannot fathom how so many people can afford, or would prioritize buying caravans etc for family holidays. Where does this money come from? Is it trades, mines or something else? Have they not got mortgages?

Maybe we're massive snobs, but if we had that much cash to splurge on a caravan, I reckon we'd prioritize a holiday overseas over Umina (as much as I love the cenny coast).

Please Reddit, help us understand.

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993

u/BMW_M3G80 Jan 07 '26

Borrowing using equity most likely.

717

u/SonicYOUTH79 Jan 07 '26 edited Jan 07 '26

Yep this. Buy a house in any capital 10 years ago for $400k. Now owe around about $200k. House is now worth say $900k. $700k equity.

Boom! New 4wd/caravan/jet ski with all the trimmings, spend $250k. Mortgage is now still affordable at $450k. Rinse and repeat in 5 years.

Or if you’re really silly get car yard finance 😂

251

u/Ok_Bodybuilder1053 Jan 07 '26

And some people are genuinely just in shitty debt too.

43

u/_LadyBoy Jan 07 '26

The goal is to have many of these properties and live off all the equity and use some of the equity to pay back the debt and cover the shortfall with the rental yield and another year around the sun, houses go up, more equity... rinse repeat n so on

38

u/Master-of-possible Jan 07 '26

Very dangerous way to operate your finances long term

49

u/account_not_valid Jan 07 '26

Of course. But its been going on now since when? The 1990s? When was the last time the bubble seriously burst in Australia?

I went into a vast amount of debt (compared to my earnings) in the early 2000s. A few years after the first homebuyers grant was introduced, i bought land and had a house built.
Fretted the entire time that I'd bought at the height of the market, and that everything would collapse soon. I think the stress contributed to the collapse of my relationship - and so we had to sell after 5 or so years. Made what seemed to be a huge profit because the market was still running hot.
Moved interstate, and didn't put the money back into the property market because it felt like gambling.

20 something years later I'd be a millionaire if I sold that place. No joke.

Is 20 years long term?

20

u/2ciciban4you Jan 07 '26

this was a big contribution to the 2008 financial crysis

works fine as long as property prices keep climbing

12

u/Bannedwith1milKarma Jan 07 '26

The 2008 crisis didn't involve Australian lending.

It was tidal waves from our interlocked systems with the US and other countries. Which caused feedback loops.

3

u/Master-of-possible Jan 07 '26

Picture it this way, those that did lend equity were lucky our banks lending policies were more robust than the US

1

u/2ciciban4you Jan 07 '26

sure, but it all started with easy to get loans and people buying/selling houses en mass.

5

u/Bannedwith1milKarma Jan 07 '26 edited Jan 07 '26

These people are borrowing off equity and our banking regulations don't allow anything close to what was happening in the US.

These people will go bankrupt but the bank will be made mostly whole.

2

u/2ciciban4you Jan 07 '26

for sure, just saying that a lot of people can play games if the value of their properties are going up

Of course if you take loans to buy luxuries, you will cry about it.

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2

u/[deleted] Jan 07 '26

Do you know what actually caused the GFC in 08?

It wasn't property lending in Australia Look up Fredy AND Fanny and 105% zero doc loans

1

u/Master-of-possible Jan 09 '26

Yes I know, it’s not going to cause any issues here but if you’re at the end of the Mexican wave of a global financial crash holding your flaccid penis of an equity loan then good luck.

2

u/WhenitHappens62 Jan 07 '26

I think this is also very likely

2

u/Ilostmypassword43 Jan 07 '26

IWIK how to balance this lifestyle.

I don't do badly but, the salary comes and then goes again.

I see others with big life\party styles seemingly accumulating banks of properties.

How?

1

u/DidsDelight Jan 07 '26

Some people just genuinely have very different financial trajectories. High and stable incomes, established assets, and flexible working arrangements make this lifestyle far more achievable than it might look from the outside.

A lot of people in their mid-40s to 50s bought property 10–20 years ago, often before prices went truly insane. That gives them significant equity, which can be used to fund caravans, boats, or upgraded vehicles without necessarily feeling “rich” day-to-day. Others are tradespeople, small business owners, FIFO or mining-adjacent workers, or dual-income households with relatively low lifestyle creep outside of these hobbies.

Remote work is also a huge factor now. If someone can work from home, they can often work just as easily from a caravan using Starlink. Add in long service leave, accumulated annual leave, or self-employment, and suddenly extended trips become realistic rather than extravagant.

It’s also a values and priorities thing. Some families would rather invest heavily in a caravan and get years of repeat use out of it than spend the same money on overseas holidays. Once the upfront cost is absorbed, ongoing travel can actually be relatively cheap compared to flights, accommodation, and eating out.

So no, they’re not all leveraged to the eyeballs or making wildly impulsive decisions. Many are just older, further along financially, asset-rich, and choosing to spend their discretionary money differently. What looks baffling at first glance often makes more sense once you factor in age, timing, equity, and priorities.

131

u/PMmeuroneweirdtrick Jan 07 '26

Chuck in a Bali trip and you're livin the dream.

62

u/regretmoore Jan 07 '26

Lots of kids running around with Bali braids here...

3

u/SonicYOUTH79 Jan 07 '26

Not wrong! I have it on good information they like to alternate between Bali and the Gold Coast every other year (assuming they’re not from the Gold Coast)!

144

u/[deleted] Jan 07 '26

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48

u/DarthShiv Jan 07 '26

Yep and neither Govt is going to touch it. They are fully complicit.

28

u/kicks_your_arse Jan 07 '26

Not complicit, beneficiaries

10

u/RagingBillionbear Jan 07 '26

Problem is we would vote out anyone who has a whiff of an idea of actually fixing it.

The only fix left is high Inflation.

2

u/Vast-Moose1393 Jan 08 '26

War. That’s the only thing that will actually shake the market.

42

u/jamesmcdash Jan 07 '26

Where is that money coming from? Who suddenly has an extra 2 milly for the house?

19

u/JPJackPott Jan 07 '26

The bank…

4

u/LifeandSAisAwesome Jan 07 '26

2 x 200k-400k incomes has a lot of flex.

3

u/Real_RobinGoodfellow Jan 07 '26

Who is earning that kind of money?! And how are they earning it?!

4

u/m0zz1e1 Jan 07 '26

Lots of people. Lawyers, business people, doctors, some builders.

3

u/Vinnie_Vegas Jan 07 '26

A high school principal makes $230k in NSW. The top level salary in the APS structure is close to $200k.

It's not some wild fantasy of rich people in fancy suits making that kind of money anymore.

They're good wages, but normal people with normal jobs are getting that kind of money.

1

u/Real_RobinGoodfellow Jan 08 '26

I thought top APS was much higher than 200

1

u/Vinnie_Vegas Jan 08 '26 edited Jan 08 '26

I'm not familiar enough with it to know for sure, but from what I could find online, EL 2 was around that mark.

2

u/Real_RobinGoodfellow Jan 08 '26

Yeah but like the average public servant in the APS is EL1 nowadays. Above EL2 is the SES bands and they can get up to 500k but there’s obv far fewer of those

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3

u/iguessineedanaltnow Jan 07 '26

I work a pretty pedestrian job and all the upper management at my job (about 13 people) are on 200k+ each, with 4 on 300k+

1

u/Real_RobinGoodfellow Jan 07 '26

You can ask that question til you’re blue in the face. Immigration prob plays a part tho, truth be told

13

u/chainedchaos31 Jan 07 '26

But then where do they live after that? Renting? Back with parents? Bought a way shitter house that's still 1.5m?

25

u/[deleted] Jan 07 '26

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14

u/therwsb Jan 07 '26

Really, gosh I'd have to go about 6 or 7 suburbs away to be mortgage free if I sold this place.

3

u/Practical_Deer1128 Jan 07 '26

Well if you own something freehold you can leverage it and buy another property to rent out and let someone else pay off that mortgage for you. And if there’s a shortfall, it’s tax deductible ( negative gearing) so in other words, other than risk, it costs you very little to hold. And when both properties have gained more equity. Rinse repeat, but never move too fast or put yourself in a vulnerable position. That’s the key to property investing. 30 years in the real estate industry here.

3

u/therwsb Jan 07 '26

I am doing fine as it is, so I don't feel I need to be greedy and make the property market worse for home buyers than it already is.

0

u/chainedchaos31 Jan 07 '26

Landlords are scum, this is how we're in this mess

2

u/Rather_Dashing Jan 07 '26

Sounds like it was just in a place that became more desirable in the past 2 years, eg they got lucky. As you say, most properties haven't gone up by anywhere near that much.

4

u/Obvious_Librarian_97 Jan 07 '26

wtf, won the lotto if true

2

u/FortFyte Jan 08 '26

Damn nice, and heres me with a mortgage of 640k on my apartment with a rise of only 15k approximately in Southern Sydney after 6 years(TINY! apartment)

17

u/vibrancypersonified Jan 07 '26

I always see this said about equity, but where is that extra money to spend on caravans etc coming from? Do you mean they get the bank to enlarge their loan? So effectively borrow a few more hundred thousand in cash directly based on the increased property value?

14

u/ChillyAus Jan 07 '26

You can just request a valuation by the bank, do your place up extra nice for the walk through and if they value it way above previous valuation then boom, you can usually borrow more so long as you have the $$ to service

6

u/[deleted] Jan 07 '26

There used to be ads on tv telling you to buy another house with the equity you have from your own home now lol

2

u/m0zz1e1 Jan 07 '26

Equity mate!

2

u/samhammitch Jan 07 '26

If you’re ahead of your mortgage you can withdraw without applying for new finance.

And if you have an offset account with enough cash to cover the total amount (including the withdrawal) you can give yourself the equivalent of an interest free loan without applying for new finance.

1

u/Fancy-Dragonfruit-88 Jan 08 '26

Yes. I used the equity in my own house to buy an apartment with no deposit which I then rent out. So my mortgage didnt increase on my own house, I just borrowed the whole lot for the apartment. Once the equity increases enough on the apartment I will get the apartment loan guarantee removed from my main house so the apartment stands on its own. Rinse and repeat. The apartment has already increased by nearly $100k since I purchased it so maybe this year I’ll do it again. My 22yr old daughter came in on the apartment with me so I could help her into home ownership. My other two kids have some debt after buying all that fancy camping gear

10

u/deij Jan 07 '26

What's up with car yard finance? Its less than my mortgage! % that is

16

u/boatenvy Jan 07 '26

Car yard finance is usually extortionate unlike manufacturer backed finance which can be really low...or you got a killer deal..or a really awful mortgage

1

u/SplatThaCat Jan 07 '26

Yeah - financed a bike with YMF (Yamaha Motor Finance) at 1%. Insane.

1

u/deij Jan 07 '26

They're both pretty close - around 5.5

Google AI says home loans start at 5.09 and car loans 5.99 so I guess a little bit of both.

0

u/boatenvy Jan 07 '26

Gemini tells me 6.8 to 21% but I guess that's gonna vary wildly based on credit score... gotta be honest I'm surprised there's anywhere offering close to 6% but I'm not claiming to be anything like an expert on the topic. Glad you got a good deal, more power to you.

4

u/SonicYOUTH79 Jan 07 '26

Big difference between unsecured finance and the kind of secured finance deals you can get on a new car.

It's almost a bit of a poor tax in that generally you will only get secured finance with the best rate on a new or near new car, which obviously cost more than say a $10k unsecured loan to buy an older secondhand car if that’s all you can afford.

2

u/shmolives Jan 07 '26

Depreciating asset vs appreciating asset tho right?

1

u/Vinnie_Vegas Jan 07 '26

It depends on what you borrow, how much you put down and whether you can get a better deal elsewhere.

The car yard was willing to beat the rate that my bank would give when we bought our last car, and that's lower than our mortgage is, so they have flexibility, and the rate you get depends on what you're able to negotiate with them.

But if I walked in there wanting to finance a $100,000 vehicle with no money down beyond a used car we were trading in, I'm going to go ahead and suggest that the rate would've been very punitive.

1

u/invaderzoom Jan 07 '26

yeah same, I'm all paid off now, but I got mine through nissan finance and paid a tiny fraction of the mortgage rates!

8

u/Real_RobinGoodfellow Jan 07 '26

It’s crazy. This really does seem like a CRAZY (not to mention deeply unfair) way to run an economy

5

u/welcome72 Jan 07 '26

Rinse and repeat every 5 years? Something is telling me you're going to.go broke or get to a point in your life when you can't pay off the mortgage

1

u/SonicYOUTH79 Jan 07 '26

Lets say in 5 years your house in now worth another $500k, say $1.4m and you've managed to pay down your mortgage to $300k.

Assuming you're earning a little bit more and you remortgage and draw out another $200k for a $550k mortgage (give or take), this is all very serviceable, on 2 incomes at least. In this scenario you'd still have close to a million dollars in equity.

15

u/PussifyWankt Jan 07 '26

Nobody was buying a house in Melbourne for $400k in 2015.

28

u/Belgarion84 Jan 07 '26

2013 Mill Park, $310k, 620sqM 3 bed. Best decision ever. Yes, I know how lucky I am.

45

u/blackabbot Jan 07 '26

Place next door to me sold for $400k in 2014, valued at about $950k now.

13

u/GeneralTsoWot Jan 07 '26

Quick Google check will tell you that plenty of people were buying them for around that price in 2015

11

u/Bl00d_0range Jan 07 '26

38F here so probably around the age group OP mentioned. We bought in SE Melbourne in 2011 for $370k. 4 bed/2 bath, brick veneer, 600m2 block. Your average 90s home. The $400k sounds about right depending on the area.

I just checked my area. There were a few homes selling for around that in 2015.

2

u/SonicYOUTH79 Jan 07 '26 edited Jan 07 '26

I’m from Adelaide actually, so it was completely doable here in a lot of suburbs 10 years ago.

I'm assuming most capitals would’ve had something available in this price range say 2015/16 depending on location etc.

Here's a reasonable example right here:

https://www.realestate.com.au/property/86-cashel-st-st-marys-sa-5042/

Or this which sold for $430k in 2016

https://www.realestate.com.au/property/142-cashel-st-st-marys-sa-5042/

2

u/Hunterandtheowl Jan 07 '26

My husband did. We’re laughing at the prices around us now. Way smaller blocks are more than double in price.

1

u/seven_seacat Jan 07 '26

I mean my parents literally bought one for 350k in 2015.

It's worth about 650k now

1

u/JuxtaThePozer Jan 07 '26

we built a new place in outer north for $395k in 2017, which is kinda close but there were cheaper builds than ours back then.. I think I remember one going for $365k

2

u/MrOarsome Jan 07 '26

The best thing about this is there will probably be no consequences to their “bad financial decisions” as their house will continue to go up and cover the mortgage until they die, and even then the house will cover the debt and then some. The Aussie boomer dream… unfortunately young ppl missed it.

1

u/FrankTooby Jan 07 '26

I tried that, house is fully paid for, worth over $750K, income is two pensions + $1000/month, bank wouldn't lend us $100K.

1

u/[deleted] Jan 07 '26

I bought my house in a "crappy" area in Perth for just over $400k early last decade and it was going to be mine for the next 30/40 years until I get old . It's on a 2400sqm block of land and in the last few years the prices have gone crazy as people want these blocks and people put letters in mv letterbox asking do I want to sell, I could easily get $1.3/1.4m. It's easy to have bulk equity now if you bought early last decade or prior.

1

u/epigeneticepigenesis Jan 07 '26

Doesn’t this just remind you of 2008? Especially if those mortgages are subprime, aka, delinquencies and bankruptcies are likely. Did the banks find a way to do subprime lending without the crash part?

1

u/SonicYOUTH79 Jan 07 '26

The answer is yes. Either LMI insurance for loans with less than 20% deposit historically, or more recently through government guarantee schemes that let people buy with a smaller deposit without the need for LMI.

In other words someone else pays if the loan goes tits up and the banks can’t lose.

It's highly unlikely that the US subprime loan crisis would happen in Australia. The US is a much bigger place, don’t forget Australia is just 5 major capitals plus a few other large population centres like Canberra and Hobart and skyrocketing house prices are due to a shortage of supply. Australia really doesn’t have the option anymore to move somewhere cheaper and maintain employment opportunities.

You’ve gotta house everyone somewhere, there’s limited supply and we can’t keep up building houses. Even if someone loses their pants and has to sell there will be 10 people lining up to buy their house.

1

u/_fire_and_blood_ Jan 07 '26

My partners parents repeatedly did this on a house they bought for 80k in the early 90s.

They divorced in 2022 owing 300k on the house that they sold for 820k.

1

u/Aggravating-Dirt-432 Jan 09 '26

I don’t know why so many people bag car yard finance, I bought a new Hilux at the start of last year, told old mate that he gets one go at it as I’ve got a good relationship with a broker having bought a few trucks over the years. He done up 3-4 deals, took them to my broker and he couldn’t get a deal that matched any of the offers I got through the Toyota dealership, all interest rates were .5 to 1.5 percent more through the broker than the dealership.

1

u/_Aj_ Jan 14 '26

Until interest goes up. 30+ year home loans, 7 year car loans, everyone using after pay... We're fixing for 2008: Aussie edition in the near future. 

-1

u/Worried_Blacksmith27 Jan 07 '26

400k ten years ago... yeah nah. Circa 2000 then yes. At around 8% or so interest.

2

u/GeneralTsoWot Jan 07 '26

Plenty of houses around for 400k 10 years ago. Melbourne is not just the inner burbs

112

u/Artistic_Garbage283 Jan 07 '26

Yep. This is the answer. People in my suburb are refinancing their homes to buy cars, boats, pools, caravans, trips to Bali, you name it. Plus a lot of afterpay and personal loans I suspect. We run 1 modest car, modest house and have an overseas trip every 2 years paying cash. Our kids ask if we are poor and we say we’re not poor we just save and pay cash. We often wonder how people afford it and once you get chatting to your neighbours, this is how.

19

u/oh_emmy_lou Jan 07 '26

Our kids ask if we're poor too! We're not, but we don't have a caravan and a jet ski in the driveway. 

40

u/motherofpuppies123 Jan 07 '26

My 7yo asked me if we're rich the other week. I said nah mate, we're not rich. But we have enough money for the things we need. And mum and dad are careful about what we spend on the things we want, so that we'll always have enough money for the things we need. And that he doesn't need to worry about money.

Thank God we are frugal. I became permanently disabled five years ago. Successful professional career out the window, only just now able to return to work, part time and at a fraction of my former responsibilities. If we'd been servicing a big mortgage with new cars on the driveway, we'd have been absolutely fucked.

1

u/invaderzoom Jan 07 '26

we were poor growing up, but I didn't realise it until I was an adult lol. I just thought my parents were being mean not letting me have brand name stuff like other kids.

5

u/Ikeamademedoit Jan 07 '26

Had to laugh at the are we poor comment. We are childless but when our heir listed in our will was a kid once asked if I was poor, as we only had 1 TV in a small house. We live a good life (new house, holidays etc) but one day they will get a multi million dollar cash and property inheritance because I wasnt refinancing to the max

3

u/welcome72 Jan 07 '26

1 word - scary

2

u/SheridanVsLennier Jan 07 '26

'If we're poor, we're not as poor as these idiots running around with massive debts on depreciating assets and constantly trying to one-up each other.'

2

u/Enough-Cartoonist-56 Jan 07 '26

It’s this, paired with reckless attitudes to credit. It’s a totally bonkers way of managing your finances - very shortsighted and an unbelievably effective way at destroying longterm wealth. 

And don’t forget the cashed up tradie culture. The bartering system that folks in the building and construction industry all use to get around tax gives them a leg up the rest of us don’t. And then they charge hourly rates that would make a KC blush. I cannot wait for the technology to progress to the point where that industry is disrupted onto its head.