Nine of Australia's top ten regions for mortgage deferrals in Queensland

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on September 30, 2020
Nine of Australia's top ten regions for mortgage deferrals in Queensland

 Photo by Luisa Denu on Unsplash

Queensland tourist destinations were nine of the top ten regions for mortgage deferrals in the first wave of COVID lockdowns.

That's according to new analysis from credit reporting agency Equifax, which found Noosa, Surfers Paradise, Coolangatta and the Whitsundays had the highest proportion of deferrals compared to the national average. 

Looking to compare low-rate, variable home loans? Below are a handful of low-rate loans in the market.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
FixedMore details
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Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.

Rates correct as of January 26, 2022. View disclaimer.

General Manager Advisory and Solutions at Equifax Kevin James said the data revealed the extent of the damage to the tourism-dependent Queensland regions. 

“Tourism is a major industry for Queensland, and with international and domestic visitors curtailed during the pandemic, tourist hotspots have faced reduced occupancy rates, lower incomes and higher levels of unemployment leaving mortgage holders feeling the pinch," Mr James said.

"With the Queensland border beginning to reopen to parts of NSW and SA this week, we expect to see a bounce back as tourism dollars start to flow back into the region."

Proportion of mortgage deferred by accounts 

qldtourdef01

Source: Equifax

The release of the data coincides with the Queensland eviction ban ending today, with the state the only one in Australia deciding not to extend the moratorium on residential evictions

Melbourne suburbs show signs of heightened mortgage stress 

Tullamarine-Broadmeadows on the outskirts of Melbourne was the only non-Queensland location to make the top ten list of mortgage deferral hotspots. 

However, several other Melbourne fringe suburbs also showed signs of heightened mortgage stress in May when the data was collected.

Analysis showed Wyndham, Casey-South, Whittlesea-Wallan, Melton-Bacchus Marsh, and Boroondara all had a high number of mortgage deferrals compared to the national average.

Number of mortgages deferred by accounts 

qldtourdef02

Source: Equifax

Mr James said the financial hardship seen as these suburbs could be attributed to a higher prevalence of lower socio-economic suburbs, with low-income households and young people just starting out on the property ladder. 

“COVID-19 is having a particularly negative effect on the employment of young people," he said.

"For those without significant savings, it isn’t easy to service a home loan when cash flow dries up.

"We know Melbourne’s second lockdown will have further exacerbated the difficulties we’ve seen in our initial analysis on the available May data." 

Middle-aged Aussies struggling to pay their mortgage

Equifax found Australians aged 36 to 45 were the most likely age group to defer their mortgage repayments through the pandemic. 

“There are more middle-aged people seeking mortgage payment relief than any other age group," Mr James said.

This group is likely to have relatively high outstanding mortgage balances and may have been harder hit with business lay-offs or lower-income from JobKeeper payments.”

The 26 to 35 age group fared only marginally better, accounting for the second-largest number of mortgages deferred. 

Over 66-year-olds also had higher levels of deferrals, which was likely a reflection of deferred investment property loans. 

Proportion of mortgages deferred - age by account 

qldtourdef03

Source: Equifax


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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Alex joined Savings.com.au as a finance journalist in 2019. He enjoys covering in-depth economical releases and breaking down how they might affect the everyday punter. He is passionate about providing Australians with the information and tools needed to make them financially stable for their futures.

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