Any rise a risk to mort­gage

Townsville Bulletin - - NEWS -

EVEN a small rise in in­ter­est rates would put more than 10,000 Queens­land house­holds at risk of de­fault­ing on their home loans.

Ahead of the Re­serve Bank of Aus­tralia’s board meet­ing to­day, fig­ures re­veal more than 144,000 home­own­ers in the state are in mort­gage stress and about one in five are close to de­fault.

Just a 0.5 per cent in­crease would throw more than 150,000 Queens­land home­own­ers into stress and 10,191 would be close to be­ing forced to de­fault or sell up, ac­cord­ing to anal­y­sis by Dig­i­tal Fi­nance An­a­lyt­ics.

In­creas­ing rates by 2 per cent would put more than 12,200 peo­ple at risk of los­ing their homes.

Across the na­tion, a quar­ter of house­holds, or more than 820,000, are es­ti­mated to be in mort­gage stress, which is up from 810,000 in July.

Nearly 53,000 house­holds across the coun­try risk de­fault in the next 12 months.

Dig­i­tal Fi­nance An­a­lyt­ics prin­ci­pal Martin North said flat in­comes and un­der­em­ploy­ment meant ris­ing costs were not man­aged by many home­own­ers.

“De­spite the record low cash rate, many house­holds are only just man­ag­ing to pay the bills, and ris­ing power and child­care costs are mak­ing this more chal­leng­ing,” Mr North said.

“We are on a knife edge, and even small lifts in rates will have a sig­nif­i­cant im­pact.”

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