A quarter hit by mortgage stress

Monday 11 May 2009

Article by Mozo

A quarter of all mortgage customers are having difficulty repaying their home loans each month, the latest figures from Datamonitor have shown.

The group, which has taken a comprehensive snapshot of the Australian housing market, has found that despite the abundance of low-interest home loans on the market, 30 per cent of people polled said they were having trouble making payments.

Commenting on the figures, the senior analyst at Datamonitor Peter Ingemarsson said that there is a risk the country could fall into a spiral of debt difficulty.

The concerns of home loan customers were mimicked in the wider consumer economy, with 29 per cent of all Australians polled worried that they will be unable to make their bill repayments over the coming year.

"There is the risk that consumer concerns will result in a negative spiral, as lower consumer spending leads to lower business spending and higher unemployment," he explained.

In March, Datamonitor also warned that the number of home loan defaults has been rising sharply since the onset of the financial crisis.

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