Postal codes where Australians can’t pay off their mortgage despite historically low interest rates

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Postal codes where Australians can’t pay off their mortgage have one thing in common: they’re far from the city center.

Consumer group CHOICE has revealed suburbs where borrowers cannot meet monthly repayments despite major banks offering fixed mortgage rates below 2%.

Digital Finance Analytics, which provided CHOICE with April 2021 data, defines mortgage stress as a situation where homeowners can’t meet their mortgage obligations – and not just spend a third of their income on their loan.

CHOICE chief executive Alan Kirkland said borrowers in those outlying suburbs and regional areas were struggling to even get food on the table.

Postal codes where Australians can’t pay off their mortgage have one thing in common: they’re far from the city center. Campbelltown, over 55 miles from downtown Sydney, Australia’s mortgage stress capital with postcode 2560 home to 10,578 distressed borrowers. The surrounding suburbs of Airds and Leumeah are on the list. A short drive away, the Liverpool and Casula area in southwest Sydney had 10,002 households in dire straits

Mortgage stress hot spots in Australia

1.2560: Campbelltown, Airds, Leumeah (10,578 households)

2.1170: Casula, Liverpool, Moorebank (10,002 households)

3.6065: Wanneroo, Melaleuca (9,889 households)

4.4350: Toowoomba (9,693 households)

5.3805: Fountain Gate, Narre Warren (8,919 households)

6.3806: Berwick, Harkaway (8,292 households)

7. 3029: Hoppers Crossing, Tarneit (7,972 households)

8.3350: Ballarat, Sovereign Hill (7,546 households)

9.3037: Delahey, Sydenham (7,229 households

10. 6030: Quinns Rocks, Merriwa (6,876 households)

Sources: Digital Finance Analytics, CHOIX

“These are households where from fifteen to fifteen days, people spend more than they earn,” he said.

“It means they have to make tough choices, like putting food on the table or keeping track of reimbursements. If they can’t keep up the juggling game, they risk losing their home.

Campbelltown, over 55 miles from downtown Sydney, Australia’s mortgage stress capital with postcode 2560 home to 10,578 distressed borrowers.

The surrounding suburbs of Airds and Leumeah are on the list.

A short drive away, the Liverpool and Casula area in southwest Sydney had 10,002 households in dire straits.

Melbourne’s furthest suburb was also in Red Territory, with 8,919 borrowers in Fountain Gate and Narre Warren, 27 miles from the city center, making it the top five list for mortgage stress.

The neighboring town of Berwick in the Dandenong Ranges was next with 8,292 houses struggling on their loan.

Suburbs in the western suburbs of Melbourne were also struggling with 7,972 households unable to cope financially in Hoppers Crossing and Tarneit while 7,229 other borrowers struggled in Delahey and Sydenham.

Perth had two spots in the top ten list for mortgage stress with 9,889 in the red at Wanneroo while another 6,876 struggled at Quinns Rocks and Merriwa.

Regional areas were also not immune with 9,693 struggling households in Toowoomba, west of Brisbane, while 7,546 struggling in Ballarat west of Melbourne.

Melbourne's furthest suburb was also in Red Territory, with 8,919 borrowers in Fountain Gate and Narre Warren, 27 miles from the city center, making it the top five list for mortgage stress.  The neighboring town of Berwick in the Dandenong Ranges was next with 8,292 homes struggling with their loan

Melbourne’s furthest suburb was also in Red Territory, with 8,919 borrowers in Fountain Gate and Narre Warren, 27 miles from the city center, making it the top five list for mortgage stress. The neighboring town of Berwick in the Dandenong Ranges was next with 8,292 homes struggling with their loan

Perth had two spots in the top ten list for mortgage stress with 9,889 in the red at Wanneroo as 6,876 others struggled at Quinns Rocks and Merriwa

Perth had two spots in the top ten list for mortgage stress with 9,889 in the red at Wanneroo as 6,876 others struggled at Quinns Rocks and Merriwa

A Senate economics committee recommended in March to repeal responsible lending laws introduced by Kevin Rudd’s Labor government in 2009 at the height of the global financial crisis.

The leader of a nation, Pauline Hanson, opposes the federal government’s decision to repeal these laws.

Mr Kirkland said abolishing the ten-year-old laws would see more borrowers taking risks they couldn’t manage.

“ If the government gets away with its plan to abolish secured loan laws, people who are desperate to enter a booming housing market will be at risk of overexposure and people who need to refinance will not be sufficiently protected, ” he said.

CHOICE chief executive Alan Kirkland said borrowers in those outlying suburbs and regional areas were struggling to even get food on the table.  Pictured are houses on the outskirts of Sydney

CHOICE chief executive Alan Kirkland said borrowers in those outlying suburbs and regional areas were struggling to even get food on the table. Pictured are houses on the outskirts of Sydney

The Royal Banking Commission completed two years ago also criticized banks for approving loans that borrowers were unable to provide.

Fear of missing out saw Australian house prices early in the year rising at a faster rate since October 1988.

Between January and April, median home prices in Sydney jumped 11.2% to a new record high of $ 1.147 million, more than making up for the five consecutive months of decline from May to September of the year last, according to data from CoreLogic.

Home prices in the more upscale suburbs of the Upper North Shore, Northern Beaches, and Sutherland Shire have seen significantly higher increases, with those zip codes having much lower mortgage stress levels despite the higher prices.



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