By Stephen Johnson, economics correspondent for Daily Mail Australia
05:30 25 December 2023, updated 07:20 25 December 2023
The cost of living crisis is now so bad that Australian families are postponing Christmas until after the Boxing Day sales.
Consumer expert Graeme Hughes, director of Griffith University’s Business Lab in Brisbane, said rising mortgage repayments meant some distressed families would open their gifts on December 26.
“Certainly, I’ve already heard quite a few consumers who are following and celebrating Christmas on Christmas Day – jumping in early, planning ahead to buy early on Christmas Day,” he told Daily Mail Australia.
Others celebrate a second Christmas by handing out fewer presents on Christmas Day, and instead opening more presents on Boxing Day.
“It’s a second Christmas for many families after they played Christmas on Christmas Day,” he said.
The Australian Retailers Association and Roy Morgan Research expect consumers this year to spend $23.9 billion in this year’s Boxing Day sales, representing an increase of $400 million or 1.7 per cent on 2022.
But Mr Hughes said budget-conscious Australians who celebrate Christmas on December 25 were more likely to buy their gifts in November’s Black Friday sales.
He added that discounts of at least 30 per cent or more were needed to entice customers to spend more on Boxing Day than last year, especially for things such as electrical appliances.
“To get consumers moving right now, it looks like they’re at least 20, if not 30 and up,” Hughes said.
The cost of living crisis has also seen a rise in demand for things like home security, as tough times lead to increased crime in parts of north Queensland.
“We’ve seen some interest in home security, especially around youth crime and things like that,” he said.
The Reserve Bank in November raised interest rates for the 13th time in 18 months, taking the cash rate to a 12-year high of 4.35 per cent.
Monthly payments on variable mortgages have risen by 68 per cent since May 2022, when banks were offering variable mortgage rates starting at ‘two’.
Inflation fell in October to 4.9 percent, a significant decline from the highest annual pace in 32 years of 7.8 percent at the end of 2022.
Australian Bureau of Statistics data showed electricity bills rose by 10 per cent over the year with petrol prices rising by 8.6 per cent.
This has left savings to spend on Christmas gifts, although clothing costs fell by 1.7 per cent over the year.
“There are fewer presents under the tree this year,” Mr Hughes said.