According to Fitch Ratings, Logan City, the Gold Coast and Ipswich have also shown significant economic deterioration since September last year, but its study of suburbs where the mortgage delinquency was highest pinpointed seven Queensland locations among the worst 20 throughout Australia.One of the reasons for Queensland’s poor performance could be higher-than-average unemployment in the worst-affected areas.

Outside Sydney and Brisbane, Airlie Beach and Noosa were among Australia’s worst regions for delinquency. The survey found that 1.7 per cent of Queensland homeowners missed mortgage payments in the six months to September.This was down from 2 per cent in March, but still the highest level of all the states.

Helensvale, Carbrook, Surfers Paradise and Kingston were suburbs in Australia’s worst 10 for missing mortgage payments.

Sydney’s southwestern suburbs and the central coast of NSW, along with the Gold Coast and the southwest region of Western Australia, continued to have above-average mortgage arrears, although there was an overall improvement noted nationally.

Fitch said the 10 worst-performing regions in September were the same as in March 2011, although delinquency rates had decreased across all of these regions.

The Fairfield-Liverpool region in Sydney’s depressed southwest was the worst-performing region in Australia, but cases of arrears of more than 30 days decreased to 2.63 per cent in September 2011.

Fitch said Logan City had shown a strong improvement in its arrears, falling from 2.8 per cent to 2.38 per cent, indicating that borrowers had been able to cope with interest rates.

The Gold Coast West, Logan City and Ipswich had also improved, but their improvement had been below the Australian average. In March 2011, these regions experienced a significant deterioration by number of borrowers in arrears and had shown a more moderate improvement than the rest of the country since then.

The survey did not include the recent interest rate cuts.

WORST POSTCODES

1 2315 NSW Nelson Bay 7.8

2 2262 NSW Budgewoi 4.6

3 4212 QLD Helensvale 4.3

4 2576 NSW Kangaloon 4.3

5 2171 NSW Hoxton Park 4.0

6 4217 QLD Surfers Paradise 3.9

7 4130 QLD Carbrook 3.9

8 4114 QLD Kingston 3.8

9 2106 NSW Newport 3.8

10 2761 NSW Plumpton 3.7

11 4567 QLD Noosa Heads 3.6

12 4802 QLD Airlie Beach 3.6

13 2753 NSW Richmond 3.4

14 2324 NSW Karuah 3.4

15 2325 NSW Cessnock 3.4

16 6167 WA Casuarina 3.4

17 2177 NSW Bonnyrigg 3.3

18 2428 NSW Forster 3.3

19 2263 NSW Gorokan 3.3

20 2430 NSW Taree 3.2

Fitch also pointed out that Australia’s mortgage delinquency was not as bad as in the UK and the US, where it has hit double figures.

The report shows that NSW and QLD carry the greatest shortfalls of 73,700 and 61,900.

The report predicts the gap could grow to more than 640,000 homes in the next 20 years based on household growth and current building trends.

Owen Donald NHSC chairmen said more government financing for housing for low-income earners and financing support, along with changes to planning and development approval, could boost supply and affordability.

“Existing demand-side measures like the first home owners grant and commonwealth rental assistance could also be re-examined with a view to having a more substantial impact on housing supply and affordability,” Mr Donald said in a statement.

Housing Industry Association CEO Mr Graham Wolfe said excessive and inefficient taxation and land supply remain high priorities for change. “Taxation, levies and charges on a new house-and-land package can be in excess of 40 per cent of the purchase price,”

“Independent economic modelling shows that the taxes on a new home are often in excess of the price of the land.”

Mr Wolfe said access to land for development was a problem, and all levels of government should tackle the availability and affordability of housing for Australian families.

Newly appointed Housing Minister Robert McClelland said the report highlighted the need to address the inescapable fact that growth in underlying demand for housing was outstripping supply.

“The report confirms that access to affordable housing is a challenge for many Australians,” Mr McClelland said. “We need to make sure housing supply matches the needs of our changing populations.”

Commercial loans soared 16.5 per cent in the month on a seasonally adjusted basis, driven by a surge in revolving credit, the Australian Bureau of Statistics says.

But investment property loans partially offset those gains, down 2.9 per cent after rising the same amount in September.

In a further sign of weakness in the property sector, home loans to owner occupiers also shrank, down 1.2 per cent after gaining 0.7 per cent the month before.

Personal finance commitments rose 5.2 per cent and lease finance fell 2.4 per cent.

Source:

http://www.abc.net.au/news/2011-12-13/lending-finance-abs-october/3728922

Glenn Stevens RBA Governor, in a statement issued with the interest rate cuts announcement discussed “considerable turbulence”and the view that financing conditions had become more difficult.

“The Reserve Bank indicated that it is still concerned about the European economic situation and the prospects of a global slowdown hurting Australia and its export markets,” said economics analyst Ross Greenwood.

Mr Greenwood cautioned consumers not to expect the banks to pass on the full interest rate. The Big 4 banks (CBA, NAB, ANZ and Westpac) will not guarantee that they will pass on the full interest rate cut to customers.

Home equity loans were generally utilized to finance these home improvement projects. A home-equity loan is a unique type of mortgage which allows homeowners to take out a second loan on their home by using the equity they had built up in their homes.

Due to the fact that home values were rapidly increasing in many areas, and interest rates were low, many found it easy to borrow thousands of dollars to toward home renovations.

During this time kitchen and bathroom renovations and upgrades were particularly popular. In many cases, homeowners were able recoup around three quarters of the cost of individuals renovations. It was not unheard of for some homeowners to recoup the total price of the renovation.

Today; however, the boom is a memory and the global financial crisis means that many are far more cautious about the value of their homes and the equity they have in it.

Home-equity loans for the purpose of renovating homes aren’t easy to come by as they once were. Like the rest of the home loan business; however, the default fee for home-equity loans has increased sharply. As a direct outcome, lenders are being far more cautious today about generating home-equity loans.

Pre Approved Home Loan

~ A formal or informal indication of how much a lending institution is willing to loan an applicant, before a property has been determined.

All major banks and building societies offer loan pre approvals and all will be subject to some basic conditions before final approval; notably a valuation conducted by the institution, and in some instances application fees and timeframes will apply.

Obtaining a pre approved home loan prior to commencing the search for a suitable property has some major advantages for the potential buyer.

Knowing how much borrowing power you have lets you focus on the properties within your budget, place bids at auction and in a seller’s market where buyers are plentiful and competitive, having secured pre-approval may see your offer accepted by the vendor over one that has not.

• Make sure you meet basic loan requirements. If you have not been employed by your employer long (less than 12 months), don’t have a savings history and or have moved home in the past two years, it may be best to wait until your circumstances settle to apply for a loan.
• Ask if you are required to pay an upfront fee before you make your appointment.
• Do your research and approach the lender/s that suit you best.
• Approach the lender you already bank with, if others are better suited to your needs let your bank manager know, their terms and conditions are often more flexible than you may think.
• Be upfront about any past credit problems.Know the details of the defaults, explain the situation that caused the difficulty, how you overcame it and why your situation is now different.
• Have all your documentation together when you meet with the home loan manager – proof of identification, savings history, tax returns, proof of assests and liabilities.

Finally, remember; as tempting as it may be to go house hunting, before you start looking for a home, look for a home loan pre approval first – it could save you in the long wrong.