Queensland mortgage borrowers in arrears

Home owners in Queensland ranked as one of the regions with the most number of borrowers in arrears based on a FitchRatings report.

Australian Mortgage Delinquency by Postcode showed that Queensland, Gold Coast and Brisbane CBD were among the areas it among the top places where borrowers were falling behind payments. Moreover, Queensland ranked after Western Australia in terms of the highest level of mortgage balances in arrears in the country.

The report studied 220,000 mortgages in Queensland amounting to $39 billion. It said that the state experienced a "remarkable deterioration" in performance during the year to September, with 30-plus day arrears increasing from 1.12 percent to 1.54 percent.

Borrowers’ decreasing ability to pay was a symptom of rampant unemployment gripping the state this year plus declining house prices and rising interest rates. In Inner Brisbane, delinquency rates have shot up as loans are delayed payment by one or two months.

The most delinquent areas in terms of loan payment is Logan City, where one in every 70 home loans was found to be in arrears, and the Gold Coast, where one in 75 borrowers are falling behind more than 30 days.

The rate of delinquency was also affected by some huge loans that tended to affect the overall picture.. "In fact, inner Brisbane is among the best performing regions in terms of number of borrowers in arrears," the report wrote. "Future performance might therefore normalize, aligning itself with the rest of the inner part of the city.

It added: "However, Fitch still believes that coastal regions like the Sunshine Coast and the Gold Coast East are subject to a higher level of volatility than the rest of Queensland."