Fitch has released its latest mortgage arrears report for end of September 2011, with marked declines across the country since the March report. All states and territories showed improvement, overall delinquencies fell from 1.77% to 1.42%, according to Fitch on “account of stable interest rates”.
Notably, the 10 worst performing regions were the same in March, with Sydney’s south-western suburbs, the south-western region of Western Australia and the Gold Coast still suffering above average arrears rates.
From the report:
- Fairfield-Liverpool continues to be the worst performing region in Australia, but 30+ day arrears decreased to 2.63% in September 2011 (from 2.99% in March 2011).
- South-west Western Australia arrears decreased significantly by 76bp to 2.17%, although they are still above average.
- Northern Middle Melbourne is currently the best performing region in Australia by value (30+ day arrears at 0.54%).
- In Western Australia, one in four obligors has cured their delinquency status since March 2011.
- As of September 2011, Queensland was still the worst performing state in Australia in terms of mortgage performance recording a delinquency rate of 1.7%, albeit down from 2% in March.
- Arrears in Victoria decreased over the six months to September 2011 with an overall delinquency rate of 1.04%. Fitch’s study shows that arrears are mainly concentrated in the north-western part of Melbourne.
- Nelson Bay remains the worst performing postcode overall by loan amount – recording a delinquency ratio of 7.8% – and the second worst performing postcode by number of borrowers in arrears (31 out of 1,000). Nelson Bay has been the worst Australian performing postcode in terms of mortgage performance over the last two and half years, due to strong 90+ day arrears (often influenced by housing speculation).
- Other suburbs, such as Budgewoi (NSW), Casuarina (WA), and Helensvale (QLD), remain among the worst performing postcodes.
- Fitch has also noticed that an increasing number of the 20 worst performing suburbs in Australia are located in “tourism destinations” such as Arlie Beach, Noosa Heads, Surfers Paradise and Nelson Bay.
The full report is available below:
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Australian Mortgage Delinquency by Postcode 30 September 2011