Mortgage arrears begin to climb

RESIDENTIAL PROPERTY

AUSTRALIAN prime and nonconforming mortgage arrears are on the rise, according to S&P Global Ratings, as multiple interest-rate rises begin to...

S&P Global Ratings’ RMBS Performance Watch: Australia showed 30-plus day non-conforming RMBS mortgage arrears hit 3.2% in December.

Exposure to loan-to-value ratios above 80% was 9%, compared to 40% during the global financial crisis.

“While arrears remain below long-term averages, we expect them to continue to rise because mortgage repayments make up an increasing share of...

“Among originators, prepayment rates are diverging. These rates are a marker of refinancing activity and borrowers’ ability to pay down loans...

The current strong competition in refinancing activity may help some borrowers to avoid going into arrears, but not...

“To date, arrears increases have been delayed by built-up savings and strong employment growth, enhancing job mobility...

Appearing before parliamentary economics committees in February, RBA governor Philip Lowe reiterated the bank’s determination to keep hiking rates in...

“Despite the difficult times ahead for some borrowers, we expect strong employment conditions and proactive efforts by...

Meanwhile, new research from Roy Morgan shows an estimated 1.19 million mortgage holders – or 24.9% – were “at risk” of “mortgage stress” in the three months to January 2023.

This period encompassed two interest rate increases of 0.25% taking official interest rates to 3.1% in early December.

The proportion of mortgage holders now considered “at risk” of mortgage stress is the highest since June of 2012 and...

The number of Australians “at risk” of mortgage stress has increased by 486,000 over the last year as the RBA increased interest rates for...

The number of mortgage holders considered “extremely at risk”, has now increased to 710,000 (15.4%) in the three months to January...

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