New data has revealed 12 per cent of Whitsunday residents with a mortgage are struggling to pay it back. Picture: iStock
New data has revealed 12 per cent of Whitsunday residents with a mortgage are struggling to pay it back. Picture: iStock

Whitsundays struggling most in state for mortgage repayments

THE Whitsundays has the highest proportion of residents struggling to pay back their mortgage in the state, new data has revealed.

A study by global information solutions company Equifax revealed 12 per cent of Whitsunday residents with a mortgage had difficulty paying it off.

The region had the highest proportion of mortgage referrals for Queensland in May 2020 and the second highest in the country.

Nine of the top ten regions for mortgage deferrals were in Queensland and included other holiday destinations such as Noosa, Surfers Paradise and Coolangatta.

Equifax general manager of advisory and solutions Kevin James said there were a few reasons for high deferrals in the Whitsundays, the most likely being a lack of tourism.

"Tourism shutting and international travel shutting has definitely put pressure it, there's no doubt about it," he said.

People working in the tourism sector may have struggled to pay back mortgages because of job losses.

Residents working outside the sector may also feel the pinch, as many who own several properties and rent them out as holiday houses had lost a major source of income.

Mr James also said the market value of houses in the region were above average and the mortgage repayments would likely be higher in comparison to the rest of the state.

While operators and owners have reported a boost in numbers during the school holidays, Mr James said the impact this would have on mortgage repayments would be a "watch and wait" situation.

"If tourism comes back and employment comes back and everything comes back, they may be able to right themselves," he said.

"But if there's a slow uptake and it doesn't come through the peak periods of Christmas and through summer, there's really a chance that 10 per cent of the population will have some serious challenges."

A lack of tourism has meant residents renting holiday homes have lost a stream of income. Photo: Brett Wortman
A lack of tourism has meant residents renting holiday homes have lost a stream of income. Photo: Brett Wortman

Mr James said this might prompt residents with several properties to sell, therefore swinging the real estate market in favour of buyers.

"I don't want to say you could actually end up buying some cheap properties because there's a requirement for foreclosure because that may not be the case," he said.

"The outcome of that could potentially be across for sale values, but we probably won't know that until quarter one or quarter two next year."

A combination of government support and a return to business as usual were flagged as ways to pull the Whitsundays out of trouble.

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Mr James said JobKeeper and a reopening of state borders would hopefully provide a boost in income that would allow mortgage repayments to get back on track.

"The challenge will be how impaired the loan is by the time we get to March and what decisions have been made between now and March," he said.

"Although the banks are supporting and helping, they're not forgoing anything, so there's interest accruing on interest."

The Equifax data also revealed Australians aged 36 to 45 were the most likely age group to defer their mortgage repayments during COVID.

The Equifax deferral analysis was conducted in September 2020 based on credit history and repayment information available for the month of May 2020.


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