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Australians falling behind in mortgage repayments despite low rates: Fitch; Surfers Paradise the worst postcode for mortgage delinquencies - Fitch Ratings
Topic Started: 18 Dec 2013, 07:41 PM (2,004 Views)
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Surfers Paradise the worst postcode for mortgage delinquencies

By Melinda Oliver
Wednesday, 18 December 2013

It is not sunny in Surfers Paradise when it comes to mortgage delinquencies, with the beachside Queensland city proving the worst for mortgage delinquencies across the country.

A report by Fitch Ratings found that in the six months to September this year, Surfers Paradise became the worst-performing postcode when it comes to arrears on mortgages.

The area had a 30-plus day delinquency rate of 4%, replacing Nelson Bay in New South Wales, which was the highest delinquency area in the first half of this year.

Regional Western Australia proved to be a deteriorating area, with delinquencies up to 1.76%.

The report said this area has experienced an increase in unemployment and declining house prices over the six months to September 2013, which contrasts with the rest of the western state.

It also found that other regional areas in New South Wales and Queensland have not improved as much as the rest of Australia.

Across the country overall, mortgage delinquencies were down to 1.25% for the period, from 1.45% at the end of March this year.

The figure is below the six-year average of 1.52%, but still above the 1.2% compared to the end of September 2012.

Tasmania was found to be the overall worst performing state, with 30-plus day arrears in Tasmania improved by only three basis points to 1.51% at start of September 2013.

The worst-performing region nationally was Hume City in Victoria, with a 30+ day delinquency rate of 2.10% at end-September 2013.

This replaced Fairfield-Liverpool in NSW, which Fitch Ratings reported has been the worst-performing region over the past seven and half years.

Fitch Rating’s James Zanesi told SmartCompany this morning that the rise of Surfer’s Paradise for mortgage delinquencies was not a surprise.

He says it took over Nelson Bay, which had held the post for seven years, as some coastal properties that had been very slow to sell in Nelson Bay were finally sold.

Zanesi says some properties took nine or ten months to get picked up by a buyer, which severely impacted the ability to repay mortgages in certain areas. He explains that a delinquency is measured at either one month of late repayments, or up to three months of late repayments, which suggests that the mortgage cannot be paid.

In regional Western Australia, Zanesi says mortgage delinquencies could be related to the mining boom, with people investing heavily in property, but as the boom dropped so did the ability to repay.

Zanesi expects the next six months of results to show the impact of the Christmas spending season, which can cause people to get behind on repayments.

Not surprisingly, the most affluent regions had the lowest mortgage delinquency rates, with lower northern Sydney, south east inner Brisbane, northern middle Melbourne and central Perth the best regions.

The delinquency rates in these regions were in the 0.45 to 0.74% range.

Read more: http://www.propertyobserver.com.au/residential/surfers-paradise-the-worst-postcode-for-mortgage-delinquencies/2013121867013
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Australians falling behind in mortgage repayments despite low rates: Fitch

Updated Tue 17 Dec 2013, 7:36am AEDT

A major global ratings agency says the level of mortgage arrears in Australia has not fallen, despite record low interest rates.

A half-yearly study by Fitch Ratings of more than $200 billion worth of mortgage-backed securities shows 1.25 per cent of home loan customers were more than 30 days behind in repayments.

That level is down from almost 1.5 per cent in March.

But James Zanesi from Fitch says it is slightly higher than the level in September last year, despite significant interest rate reductions to the current 2.5 per cent.

"We actually see that delinquencies have remained the same despite a 90-basis-point improvement in standard variable rates," he said.

"I would say that perhaps it has to do a lot with other factors, such as unemployment and the local economy in a particular region."

Surfers Paradise on Queensland's Gold Coast has the highest level of mortgage arrears in the country, with 4 per cent of borrowers at least 90 days behind on their mortgage repayments as of September 30.

Mr Zanesi says the high rate of arrears is aggravated by the long period of time it is taking banks to sell foreclosed properties.

"When we look at postcode level, Surfers Paradise was actually the worst performing postcode in Australia," he said.

"The arrears in the Gold Coast are affected by the stagnation in the local housing market."

Mr Zanesi says the level of arrears also tended to be higher in many regional centres.

"Regional areas, such as non-metropolitan areas in New South Wales and Queensland and Western Australia, have shown an increase in delinquency rates," he said.

"Probably in Western Australia it might be due to the mining sector and volatility in such industry, but it's pretty hard to find out why the same reason applies to say NSW."

Read more: http://www.abc.net.au/news/2013-12-17/mortgage-arrears-continue-despite-record-low-rates-fitch/5160454
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MMM
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No mention that the cause of this is our jobs and businesses are being sent offshore in record numbers. No mention that having the highest wages in the world have made us completely uncompetitive and that even if we cut them in half we still could not compete as our wages would still be higher than US wages and we know how competitive they are.

I am surprised Nelson bay held this record for seven years, I had a steak at the pub there a month or so ago. I was not really looking at real estate but do remember a few for sale signs on units but don't remember too many houses, but like I said , I was not really paying attention.

I am also surprised surfers now holds the title, property there has already come down a lot since about 2006.

And WA seems to have hit the fan.
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Shadow
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Across the country overall, mortgage delinquencies were down to 1.25% for the period, from 1.45% at the end of March this year. The figure is below the six-year average of 1.52%
So, according to Fitch, 98.75% of mortgages are NOT delinquent... and in fact the current delinquency rate is well below the 6-year average.

(MMM/Ted - it's often a good idea to read past the MSM headline and actually look at the content of the article)
Edited by Shadow, 19 Dec 2013, 11:06 AM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Cash-strapped Melbourne home owners battle to pay mortgages

Stephen McMahon
December 17, 2013 12:01AM

CASH-strapped families in Essendon have the highest level of missed mortgage repayments in the state.

The adjoining Hume City region of northwest Melbourne - which includes Broadmeadows, Craigieburn, Sunbury and Melton - has been labelled the nation's mortgage black spot as the state's economy slows and unemployment rises.

The latest Fitch Ratings brands it the worst-performing region in the nation for 30-day delinquencies.

This is only the second time in seven-and-a-half years the Sydney area of Fairfield-Liverpool has not been rated the nation's mortgage default hotspot.

Hume City has also recorded the highest level of evictions from rental properties, with a 63 per cent rise between 2010 and 2012.

Industry experts warn highly leveraged households are facing a tough Christmasas their finances are battered by rocketing utility prices, rising unemployment and a struggling local economy.

The Fitch report said the economic uncertainty had even spread to Mornington Peninsula, with the area the third-worst-performing region in Victoria over the past two years, with a delinquency rate of 1.67 per cent.

Read more: http://www.heraldsun.com.au/business/cashstrapped-melbourne-home-owners-battle-to-pay-mortgages/story-fni0dcne-1226784461441
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goldbug
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Shadow
19 Dec 2013, 11:04 AM
So, according to Fitch, 98.75% of mortgages are NOT delinquent... and in fact the current delinquency rate is well below the 6-year average.

If you stood in a dog turd shadow I am sure you would lift your shoe and try and convince everyone that you had just come across an amazing free supply of garden fertilizer. Of course everyone else would see it for for what it really was, a filthy dog turd stuck to your shoe.

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A major global ratings agency says the level of mortgage arrears in Australia has not fallen, despite record low interest rates.

Hume City has also recorded the highest level of evictions from rental properties, with a 63 per cent rise between 2010 and 2012.

Industry experts warn highly leveraged households are facing a tough Christmasas their finances are battered by rocketing utility prices, rising unemployment and a struggling local economy.


Edited by goldbug, 21 Dec 2013, 06:27 AM.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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peter fraser
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goldbug
21 Dec 2013, 06:25 AM
If you stood in a dog turd shadow I am sure you would lift your shoe and try and convince everyone that you had just come across an amazing free supply of garden fertilizer. Of course everyone else would see it for for what it really was, a filthy dog turd stuck to your shoe.



I'm impressed that you have the time to post here whilst frantically trying to unload your gold.
Any expressed market opinion is my own and is not to be taken as financial advice
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mel
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Melbourne has three suburbs in the nation's top 10 worst suburbs for mortgage defaults - Essendon (3.5 per cent), Melton (3.3 per cent) and Coolaroo (3.2 per cent).


That's really very interesting. You couldn't pick three more different suburbs if you tried. The first is affluent while the others are anything but. All three were a part of the 2009/2010 boom fiasco when people lost their minds. Land prices have fallen back big time in melton since then.
APF - a place where serious people don't take themselves too seriously. There's nothing else like it.
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Shadow
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goldbug
21 Dec 2013, 06:25 AM
If you stood in a dog turd shadow I am sure you would lift your shoe and try and convince everyone that you had just come across an amazing free supply of garden fertilizer. Of course everyone else would see it for for what it really was, a filthy dog turd stuck to your shoe.
LOL, it's not my fault you can't read past the headline and you see doom and gloom turds everywhere, you silly angry little goldbug. :lol

You just got sucked in by a typically sensational MSM headline. You really are one of the sheeple.

This is a direct quote from the actual article...

'delinquencies were down to 1.25% for the period, from 1.45% at the end of March this year. The figure is below the six-year average of 1.52%'
Edited by Shadow, 21 Dec 2013, 12:01 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Pig Iron
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MMM
18 Dec 2013, 09:05 PM
No mention that the cause of this is our jobs and businesses are being sent offshore in record numbers. No mention that having the highest wages in the world have made us completely uncompetitive and that even if we cut them in half we still could not compete as our wages would still be higher than US wages and we know how competitive they are.
can't you just stop lying?

we are not the highest wages in the world. http://www.ilo.org/global/research/global-reports/global-wage-report/2012/charts/lang--en/index.htm

jobs are not being offshored at record rates. the unemployment rate has hardly climbed at all and is still incredibly low by international standards.

but feel free to provide some proof of you claims for once, but I suspect all we will get is more of this from you.

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