MORTGAGE LOANS – AUSTRALIA

Homeowners rush to refinance their loans

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Original article by Patrick Commins
The Australian – Page: 4 : 5-Oct-22

Data from the Australian Bureau of Statistics shows that a record $19bn worth of home loans were refinanced in August. This is five per cent higher than in July, and 10 per cent higher than a year ago. Owner-occupiers refinanced some $12.8bn worth of home loans, while property investors refinanced $6.1bn worth of loans. The figures also show that new mortgage loan commitments fell 3.4 per cent to $27.4bn in August; there has been a 15 per cent decline in housing loan commitments since the Reserve Bank started increasing the cash rate in May.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS

Interest rate rises: One in four Aussie mortgage holders could face financial stress

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Original article by Sarah Sharples
News.com.au – Page: Online : 4-Oct-22

Roy Morgan research reveals that close to one in four mortgage holders would be at risk of mortgage stress if the Reserve Bank lifts interest rates by 0.5% in both October and November. It would be the equivalent of 1.1 million people, and would represent the highest number of mortgage holders classed as being at risk since July 2013; Roy Morgan defines mortgage stress as having repayments greater than between 25% and 45% of household income. Roy Morgan CEO Michele Levine says the variable that has the greatest impact on whether a borrower falls into the ‘at risk’ category is household income – which is directly related to employment. She says that if employment figures remain strong, the number of mortgage holders at risk should not reach the levels seen during the global financial crisis between 2007 and 2009, when the percentage of mortgage holders at risk peaked at 35.6% in May 2008.

CORPORATES
ROY MORGAN LIMITED, RESERVE BANK OF AUSTRALIA

Mortgage stress is growing in 2022 and set to rise further as the RBA continues to increase interest rates

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Original article by Roy Morgan
Market Research Update – Page: Online : 21-Sep-22

New research from Roy Morgan shows that an estimated 854,000 mortgage holders (19.4%) were ‘At Risk’ of ‘mortgage stress’ in the three months to July 2022. This period encompassed the first three interest rate increases from the Reserve Bank. The good news is that the proportion of mortgage holders considered to be ‘At Risk’ of mortgage stress in mid-2022 is well below the high reached during the Global Financial Crisis in early 2009 of 35.6% (1,455,000 mortgage holders) and below the average of the last decade of 20.8% (904,000). Meanwhile, only 12.7% (542,000) of mortgage holders were considered to be ‘Extremely At Risk’ of mortgage stress in the three months to July 2022, below the average of the last decade of 13.9% (585,000 mortgage holders). These are the latest findings from Roy Morgan’s Single Source Survey, based on in-depth interviews conducted with over 60,000 Australians each year, including over 10,000 owner-occupied mortgage-holders.

CORPORATES
ROY MORGAN LIMITED

One in five mortgagors will struggle to pay 3pc rate rise

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Original article by Nila Sweeney
The Australian Financial Review – Page: 29 & 30 : 10-Aug-22

Comparison site Finder estimates that the average mortgage interest rate would rise to 5.85 per cent if the cash rate reaches 2.5 per cent. Finder’s Richard Whitten says recent home buyers in particular will struggle to make mortgage repayments if the cash rate continues to rise. A survey by Finder has found that one in five people with a mortgage would find it hard to make repayments if their interest rate increased by three per cent, while many would consider selling their home. SQM Research MD Louise Christopher cautions that selling in a downturn would be an added challenge for distressed home owners.

CORPORATES
FINDER.COM.AU, SQM RESEARCH PTY LTD

Mortgage stress set to rise as interest rates continue to increase during second half of 2022

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Original article by Roy Morgan
Market Research Update – Page: Online : 22-Jun-22

New research from Roy Morgan shows that an estimated 762,000 mortgage holders (17.5%) were ‘At Risk’ of ‘mortgage stress’ in the three months to March 2022. This period encompassed the ‘Omicron wave’ of COVID-19 throughout Australia, although interest rates in the first few months of 2022 were still at a record low level of only 0.10%. Mortgage stress dropped to record lows during 2021 as record low interest rates, government stimulus, and considerable measures taken by banks and financial institutions to support borrowers in financial distress all combined to reduce the number of mortgage holders considered ‘At Risk’ to fewer than 600,000 for the first time. There has been a similar trend for mortgage holders considered ‘Extremely At Risk’, with only 10.7%, or 438,000, in this group in the three months to March 2022, close to a record low. However, there has been a big change in the last few months as concerns about inflation have increased and the RBA has commenced an interest rate hiking cycle.

CORPORATES
ROY MORGAN LIMITED

ANZ remains prone to ‘liar loans’: UBS survey

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Original article by Ayesha de Kretser
The Australian Financial Review – Page: 17 : 27-Apr-22

Some 37 per cent of Australians who sought a mortgage loan in the second half of 2021 had lied on their application form, according to research by UBS. This compares with 41 per cent in 2020. The survey also shows that 55 per cent of ANZ Bank customers had included factual misstatements in their application form; this compares with 40 per cent of Westpac customers, 30 per cent of Commonwealth Bank customers and 19 per cent of National Australia Bank customers. John Storey of UBS says it is particularly concerning that 81 per cent of the ANZ customers who submitted applications for so-called ‘liar loans’ claim that they were advised to do so by their banker.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, UBS HOLDINGS PTY LTD

Mortgage stress at record lows during the 2021 lockdowns in NSW, Victoria and the ACT

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Original article by Roy Morgan
Market Research Update – Page: Online : 23-Nov-21

New research from Roy Morgan shows that an estimated 584,000 mortgage holders (15.8%) were ‘At Risk’ of mortgage stress in the three months to September 2021. This period encompassed the recent lockdowns in NSW, Victoria and the ACT, which finally ended during the month of October. Mortgage stress dropped to record lows during this period with fewer than 600,000 mortgage holders considered ‘At Risk’ for the first time. The level of mortgage stress is down on a year ago during Victoria’s long second lockdown when an estimated 668,000 mortgage holders (18.3%) were considered ‘At Risk’. The low rate of ‘At Risk’ mortgages during this period continues the trends seen during the pandemic in which record low interest rates, record levels of Government financial support, and considerable measures taken by banks and financial institutions to support borrowers in financial distress have combined to lower mortgage stress to record lows. Mortgage stress today is at less than half the level it was during the Global Financial Crisis in 2008, when it reached a high of 35.6% of mortgage-holders. Meanwhile, 18.7% of Australians with negative employment changes due to COVID-19 are now in mortgage stress – almost 3% points higher than for all mortgage holders. These are the latest findings from Roy Morgan’s Single Source Survey, based on in-depth interviews conducted with over 50,000 Australians each year including over 10,000 owner-occupied mortgage-holders.

CORPORATES
ROY MORGAN LIMITED

ING home loan customers are the most satisfied with their bank, followed by Suncorp, Bendigo Bank and BankSA

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Original article by Roy Morgan
Market Research Update – Page: Online : 29-Sep-21

New financial data from Roy Morgan shows that ING has maintained its lead at the top of banking customer satisfaction ratings among home loan customers in mid-2021. ING’s satisfaction rating rose 2.6% points year-on-year to 91.3% in August 2021. ING was followed by Suncorp on 90.3% (up 3.9% points on a year ago), Bendigo Bank on 89.1% (up 0.1% points) and BankSA on 87.3% (up 11% points). The latest data covers the six months to August 2021; overall home loan customer satisfaction amongst Australia’s top 12 banks collectively was at 77.9% during this period. This represents a decrease of 0.5% points from a year ago when there was significant financial support being offered to hundreds of thousands of home loan customers in the form of deferred loans. CBA once again has the highest home loan customer satisfaction among the big four banks, with a rating of 78.7%. Average home loan customer satisfaction with the big four banks as a group is 75.9%. These latest banking satisfaction ratings come from the Roy Morgan Single Source survey, derived from in-depth interviews with over 50,000 Australians each year.

CORPORATES
ROY MORGAN LIMITED, ING BANK (AUSTRALIA) LIMITED, SUNCORP BANK, BENDIGO BANK, BANK OF SOUTH AUSTRALIA LIMITED

Frydenberg flags home loan curbs

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Original article by John Kehoe
The Australian Financial Review – Page: 1 & 2 : 28-Sep-21

Growing concern about the high debt-to-income ratios of home buyers may prompt the federal government to push for regulatory intervention. Treasurer Josh Frydenberg discussed the issue at the Council of Financial Regulators’ recent quarterly meeting, although the CFR is not expected to announce any macro-prudential measures in its quarterly statement on 29 September. Frydenberg says Australia’s macro-prudential settings must be continually assessed, and they should be adjusted if this is deemed to be necessary.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. COUNCIL OF FINANCIAL REGULATORS

ANZ acts to halt fall in home lending

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Original article by Richard Gluyas
The Australian – Page: 17 : 19-Aug-21

The ANZ Bank has revealed that its home loan book fell by $300m during the June quarter, to $280bn. Mortgage lending grew by $16.2bn for the period, but there was a $16.5bn increase in customers paying off their loans amid record low interest rates. Meanwhile, the bank has disclosed that 1,300 of its mortgage customers were still on deferred repayment plans during the quarter, which equates to just 0.2 per cent of its mortgage book. Likewise, only 50 business loans were deferred during the quarter, compared with 24,000 in 2020-21.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ