Fitch: The number of consumers in arrears in mortgage repayments at its lowest point… Australians more comfortable with debt… Australia's banks earn $12bn in fees...
Mortgage arrears at lows due to interest rates
The number of consumers who go into arrears in mortgage repayments has likely hit its lowest point, global ratings agency Fitch Ratings says, as strong house prices and low interest rates reduce stress, according to an article in the Courier Mail.
But the agency warned that any sudden increase in foreclosures could result in higher losses for mainstream home loan providers, thanks to a sharp increase in the number of uninsured mortgages.
Fitch said the pressures on mortgages in the first quarter of the year, brought on by Christmas and holiday spending, were offset by the Reserve Bank of Australia's interest rate cut in February, which trimmed the official cash rate to, what was then, a record-low 2.25 per cent. The temporary fall in petrol prices earlier in the year also offset mortgage stress, Fitch said.
"It is evident that arrears performance has reached its lower bound," Fitch said, with arrears remaining stable since the fourth quarter of 2013, when the borrowing environment started improving. Fitch said, with sturdy issuance volumes, high house prices, stable unemployment and low interest rates, it was unlikely there will be further improvements to arrears.
Australians more comfortable with debt
Bankwest Curtin Economics Centre’s second ‘Focus on the States’ report, Beyond our Means? Household Savings a Debt in Australia finds Australians have more debt and are more comfortable with it, according to an article with Property Observer.
While household savings portfolios have seen an increase of 54% in real terms since 2005, household debt has risen by 51 per cent in the same period. Many households are able to access and service this debt, with higher debts associated with higher incomes.
On average, Australia’s estimated 9.1 million households have savings in the form of financial assets of $340,900 and debts of $148,700. However, there is a gulf between those at the top of the distribution and those at the bottom.
The inequality in the distributions of household savings and debt are considerably worse than the much talked about inequality in incomes fund, which, because of regulation, is largely concentrated in public equities in this country."
Australia's banks earn $12bn in fees
Fees earned by the banks were up 2.8 per cent from the previous year, but the Reserve Bank says that is not because the fees are higher, according to an article in the Herald Sun.
Instead, the growing use of credit cards by both consumers and businesses was the main reason for higher income, the RBA said in its annual review of fees. Households paid $4.2 billion in bank fees, or $9.01 per week on average, which is steady with the previous three years.
Income for the banks from fees on mortgages and deposits was down from 2013, but up almost six per cent on credit cards.
The number of consumers who go into arrears in mortgage repayments has likely hit its lowest point, global ratings agency Fitch Ratings says, as strong house prices and low interest rates reduce stress, according to an article in the Courier Mail.
But the agency warned that any sudden increase in foreclosures could result in higher losses for mainstream home loan providers, thanks to a sharp increase in the number of uninsured mortgages.
Fitch said the pressures on mortgages in the first quarter of the year, brought on by Christmas and holiday spending, were offset by the Reserve Bank of Australia's interest rate cut in February, which trimmed the official cash rate to, what was then, a record-low 2.25 per cent. The temporary fall in petrol prices earlier in the year also offset mortgage stress, Fitch said.
"It is evident that arrears performance has reached its lower bound," Fitch said, with arrears remaining stable since the fourth quarter of 2013, when the borrowing environment started improving. Fitch said, with sturdy issuance volumes, high house prices, stable unemployment and low interest rates, it was unlikely there will be further improvements to arrears.
Australians more comfortable with debt
Bankwest Curtin Economics Centre’s second ‘Focus on the States’ report, Beyond our Means? Household Savings a Debt in Australia finds Australians have more debt and are more comfortable with it, according to an article with Property Observer.
While household savings portfolios have seen an increase of 54% in real terms since 2005, household debt has risen by 51 per cent in the same period. Many households are able to access and service this debt, with higher debts associated with higher incomes.
On average, Australia’s estimated 9.1 million households have savings in the form of financial assets of $340,900 and debts of $148,700. However, there is a gulf between those at the top of the distribution and those at the bottom.
The inequality in the distributions of household savings and debt are considerably worse than the much talked about inequality in incomes fund, which, because of regulation, is largely concentrated in public equities in this country."
Australia's banks earn $12bn in fees
Fees earned by the banks were up 2.8 per cent from the previous year, but the Reserve Bank says that is not because the fees are higher, according to an article in the Herald Sun.
Instead, the growing use of credit cards by both consumers and businesses was the main reason for higher income, the RBA said in its annual review of fees. Households paid $4.2 billion in bank fees, or $9.01 per week on average, which is steady with the previous three years.
Income for the banks from fees on mortgages and deposits was down from 2013, but up almost six per cent on credit cards.
