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

author-avatar By 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
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only)

  • Refinance only. Fast online application
  • No Nano fees. Free 100% offset sub account
  • Mobile app, Visa debit card & instant payments
REFINANCE IN MINUTES, NOT WEEKS

Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only)

  • Refinance only. Fast online application
  • No Nano fees. Free 100% offset sub account
  • Mobile app, Visa debit card & instant payments
VariableMore details
YOU COULD WIN $100k TO PAY DOWN YOUR LOAN*

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

  • For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15
  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
YOU COULD WIN $100k TO PAY DOWN YOUR LOAN*

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

  • For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15
  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
VariableMore details
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^

Rates correct as of October 17, 2021. 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 which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

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.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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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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