Mapped: 7000 Queensland mortgages now in arrears

Thousands across Queensland have fallen behind on mortgage repayments , a situation that’s set to spark a rise in voluntary sales by distressed owners. SEE WHERE

Rising property values across Queensland helped stem the tide for distressed owners in seven regions, with some opting to sell before the bank does.

About 7,000 homes across Queensland have fallen behind on mortgage repayments in latest estimations, a situation that’s set to spark a rise in voluntary sales by distressed owners.

Latest quarterly mortgage arrears data for December 2023 from S & P Global Ratings found rampaging property prices helped ease arrears pressure in seven areas including Brisbane’s south, inner city, north, west and Moreton Bay South, but 12 other regions logged higher levels of missed repayments.

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Five SA4 regions across Greater Brisbane have seen improvements in mortgage arrears levels despite a tough year of rate rises.

Almost one in three behind by more than 30 days on repayments were from either the Gold Coast (almost 800), Toowoomba (over 750) or Logan-Beaudesert (about 720), according to analysis of the data.

Over 500 homeowners in Ipswich were also in strife with the other hard hit regional city being Townsville where almost 400 mortgages were arrears.

S & P Global analyst Erin Kitson said rising property prices had helped those who were financially distressed voluntarily sell their properties.

“For those borrowers who don’t have as much equity built up in their home loans, that may be more challenging,” she said. “But property prices are still increasing and that is something that will also help temper those arrears increases by providing those borrowers a way to voluntarily exit their situation.”

She said mortgage arrears were generally the last place for financial pressure to show up “because of that very cautionary behaviour of borrowers wanting to do everything before they have to fall behind on that debt”.

The highest level of mortgage arrears for the December quarter came out of Queensland Outback 3.89pc followed by Toowoomba (3.83pc), Mackay (1.75pc), Logan-Beaudesert (1.55pc) and Townsville (1.38pc).

RateCity research head Sally Tindall said “it is concerning that the number of people falling behind on their mortgages is on the rise, but it is astounding to think that we have been so incredibly resilient up to this point.”

“We’ve just seen 4.25 percentage points worth of interest rate rises and yet arrears are still below the long term historical average, which means that Australians are doing whatever it takes to pay the mortgage where absolutely possible.”

“Unfortunately, there are some people that are finding that no matter how many way they try to cut back, it just can’t add up.”

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Ms Tindall said many investors were shielded from that position thanks to their ability to raise rent at least once a year.

She said anyone struggling to make their repayments needed to contact their financier as soon as possible to work out what their options are.

Ms Kitson said one area where there was some relief was the transition of pandemic-era low fixed rate mortgages into the broader market – which was not as disruptive as anticipated.

Instead, she said, the biggest cause of mortgage defaults was loss of income, with the peak of broader mortgage arrears yet to occur given unemployment was forecast to increase.

“We’re expecting modest increases (in arrears) as unemployment continues to rise,” she said.

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