From Fitch Ratings report, "Mortgage Market Index - The Dinkum RMBS Index 1Q17"
- Australia's mortgage arrears increased by 12bp qoq to 1.21% at end-1Q17, due to seasonal Christmas/holiday spending and possible difficulties faced by consumers because of low real-wage growth
- The qoq increase in arrears from 4Q16 to 1Q17 was less than 1Q16 (16bp qoq to 1.10%)
- The 30+ days arrears in 1Q17 were 11bp higher yoy, despite an improved economic environment and lower standard variable interest rates
- Unemployment increased slightly by 2bp and real wage growth was low, but positive.
- Underemployment has been growing despite relatively stable unemployment
- Fitch Ratings expects arrears to fall in 2Q17 and 3Q17 after the holiday season due to the current low interest rate environment and decreasing unemployment
Summary via Reuters
