Moody’s: Mortgage delinquencies up everywhere but NSW

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From Moody’s:

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Australia-wide delinquencies decline: The proportion of Australian residential mortgages that were more than 30 days in arrears (30-plus delinquency rate) decreased marginally to 1.34% in May 2015 from 1.38% in May 2014. The delinquency rate in New South Wales (NSW) declined significantly, driving the improved nation-wide result. However, delinquencies increased in most other states.

» NSW delinquencies decline owing to Sydney property prices: Relatively strong economic activity and rapidly rising house prices in Sydney underpinned the decline in delinquencies in NSW. When property prices are rising, borrowers at risk of arrears are more likely to be able to sell their houses quickly to fulfill their repayment obligations, thereby keeping delinquencies low. If the pace of house price growth slows in Sydney – or other regions where the property market has been performing strongly – we would expect mortgage delinquencies to increase over the long term.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.