06/04/2017 - 14:48

WA home loan delinquencies the nation's worst

06/04/2017 - 14:48

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Western Australia has led the rise in national home loan delinquencies, with the state’s rate climbing to its highest on record, ratings agency Moody’s says.

WA home loan delinquencies the nation's worst

Western Australia has led the rise in national home loan delinquencies, with the state’s rate climbing to its highest on record, ratings agency Moody’s says.

In November 2016, WA’s delinquency rate (being the proportion of residential mortgages that were more than 30 days in arrears) climbed to 2.76 per cent – the highest since Moody’s records began in 2005.

Cooloongup, Ballajura, Anketell, Craigie, Armadale and Dianella were among the top 10 worst-performing suburbs in WA, while Churchlands, Scarborough, Como, Balga and Baldivis featured in the 10 best-performing suburbs.

In a statement, Moody’s said the worsening situation in WA was the result of relatively poor economic and housing market conditions.

“The Western Australian economy is heavily reliant on the resources sector and growth has slowed over the past two to three years, following the end of the mining boom,” the ratings agency said.

“Western Australia's final demand — a measure of domestic economic growth that excludes exports — fell sharply by 7.2 per cent over the year to December 2016, owing to a significant decline in business investment and weak household consumption.

“At 6.04 per cent, the unemployment rate in Western Australia, which has increased notably since 2013, is higher than the national average of 5.87 per cent.

“Average weekly wages in Western Australia were unchanged over the year to February 2017 compared with a national average increase of 1.55 per cent.

“House prices in Perth fell by 4.46 per cent over the year to February 2017 and have been in decline since June 2015.”

The national delinquency rate increased to 1.52 per cent in November 2016, up from 1.2 per cent in November 2015, with all eight states and territories reporting a higher rate.

 

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