More Australians are failing to meet their mortgage repayments, new research shows.
Investment services firm Moody’s said the rate of mortgage holders failing to meet their repayments rose from 1.36 per cent to 1.67 per cent between March and June this year.
The biggest declines in mortgage performance came in Queensland and Western Australia, where the driver of Australia’s economic strength, the resources sector, is primarily focussed.
“This apparent paradox is partly explained by the fact that non-mining jobs still account for most of the employment in both states, and such sectors lag the mining sector in growth,” Moody’s senior analyst Arthur Karabatsos said.
A good example is the impact of the Australian dollar’s strength on the tourism industry, he said.
Tourism dependant Gold Coast has the country’s third worst mortgage performance with a 3.11 per cent delinquency rate, and accounts for 6.9 per cent of Australia’s total delinquent loans, Moody’s research showed.
More alarming than the increase in national delinquency rates was a sharp rise in the number of regions in which mortgage stress is rising, Mr Karabatsos said.
The number of regions performing very poorly, defined by Moody’s as a delinquency rate of over 2.5 per cent, rose to 11 from two.
Six of those are in NSW, four are in Queensland, and one is in Western Australia.
Poorly performing regions, with a delinquency rate of two per cent, rose to 17 from five.
Moody’s research was based on the $117.6 billion in mortgages included in its rated residential mortgage backed securities (RMBS).
That represents about 10 per cent of Australia’s mortgage market.