The Definitive Guide To Our Latest Mortgage Stress Research

We have had an avalanche of requests for further information on our recent research which was published as a series of blog posts over the past couple of weeks. Here is a summary of the findings.

In addition, here is a list of links to each segment, which together provides a comprehensive view of the work. This will all be rolled up into our next Property Imperative Report, to be published in a couple  of months.

Note that a number of people went to our 2015 report – The Stressed Household Finance Landscape, which looks at households and their use of small amount credit contracts, a.k.a. payday lending. This is a separate stream of work.

So here are all the links to each element of the mortgage stress and probability of default analysis, with a short summary and publication date.

So Where Will The Property Market Go In 2017?

Having looked at events in the Property Market in 2016, we now turn to our expectations for 2017. There are many uncertainties which may impact the market, but using our surveys and modelling as a guide, we can make some educated guesses. First, mortgage rates will be higher by the end of 2017 than they …

Posted on December 12, 2016

Mortgage Stress And Probability Of Default Is Rising

We have just finished the December update of our mortgage stress and probability of default modelling for the Australian mortgage market. Our model has been updated to take account of the latest employment, wage, interest rate and growth data, and we look are the current distribution of mortgage stress (can households settle their mortgage repayments, …

Posted on December 17, 2016

Mortgage Stress Covers 18.5% Of Book Value

Containing our latest series on mortgage stress and probability of default, we look further at the distribution of mortgage stress and potential defaults, using data from our household surveys, which includes results up to the middle of December 2016. Building on the data we discussed yesterday, it is worth remembering that the bulk of mortgages …

Posted on December 18, 2016

A Segmented View Of Mortgage Stress and Default

As we continue our series on mortgage stress, using the latest data from our surveys, we look at how stress aligns with our core household and property owning segments. To set the context for this, here are a couple of charts showing the mortgage distribution by income and age bands. The majority of mortgages are

Posted on December 19, 2016

Top 20 Postcodes For Mortgage Stress Across Australia

Now we get to the pointy end of our mortgage stress and default analysis. Today we list the top 20 post codes across Australia where the highest number of households currently in mortgage stress reside. We also reveal our estimate for the number of defaults which we expect to occur in the coming months. It …

Posted on December 20, 2016

New DFA Video Blog – Household Mortgage Stress and Defaults

Using data from our household surveys in this new video blog we discuss the findings from our latest modelling. More than 22% of households are currently in mortgage stress, and 1.9% of households are likely to default. Both are likely to rise next year.

Posted on December 20, 2016

The Full 100 Mortgage Stress Listing

To complete our series on mortgage stress, based on our household surveys, here is the complete list of the top 100 most stressed suburbs, and their relative position on the default list, as at December 2016. Victoria has the highest number of suburbs in the listing. As we discussed yesterday, this is based on the …

December 21, 2016

Mortgage Default Heat Map Predictions

In our last post for 2016 we have geo-mapped the probability of mortgage default by post code across the main urban centres through 2017. You can read about our approach to the analysis here. We start with Sydney, which is looking pretty comfortable. Melbourne is also looking reasonable, though with a few hot spots. Brisbane …

Posted on December 31, 2016

Channel Nine News Does House Prices and Mortgage Defaults

A segment today from Channel Nine featured the latest data on Sydney residential property, and featured data from the Digital Finance Analytics mortgage default heat mapping, as well as the latest from CoreLogic on Home Prices.

Posted on January 3, 2017

Affluent suburbs feel heat from rising property costs

The Australian Financial Review featured the Digital Finance Analytics probability of default modelling today. We discussed our analysis on the blog recently. Property buyers in some of the nation’s swankiest suburbs are among those under most stress keeping up mortgage repayments, according to an analysis by postcode of income and debt levels. The young affluent in plush …

Posted on January 9, 2017

ABC News 24 Does Affluent Mortgage Stress

Here is a segment in which we discuss our latest research into the probability of default modelling in a rising interest rate environment.  We highlight the rise of the “Affluent Stressed” households.

Posted on January 9, 2017

A Cumulative View Of Mortgage Rate Sensitivity

We had significant interest in our recent posts on mortgage rate sensitivity in a rising market. One recurring request was for a cumulative view of rate sensitivity. So today we post these views on a segmented basis, using our master household segmentation.

Posted on January 12, 2017

One in five homeowners will struggle with rate rise of less than 0.5%

From ONE in five Australians are walking such a fine mortgage tightrope that they could lose their homes if interest rates rise by even 0.5 per cent. Our love affair with property has pushed Australia’s residential housing market to an eye-watering value of $6.2 trillion.

Posted on January 18, 2017

Home loan rates heading higher as funding costs rise, competition eases

From The Australian Financial Review. Mortgage rates are set to rise for both fixed and variable rate borrowers this year as global interest rates shoot higher, competition eases and capital rules begin to bite. “Borrowers should assume we are at the bottom of the interest rate cycle – in fact we are probably already past … Continue reading “Home loan rates heading higher as funding costs rise, competition eases”

Posted on 18 January 2017

ABC News 24 Does Household Mortgage Rate Sensitivity

We discussed the mortgage  rate sensitivity analysis we recently completed on News 24 tonight.

Posted on 18 January 2017

Mortgage Stress Grinds Higher

We have just rerun our mortgage stress models, incorporating data to 1st March 2017. Household budgets remain under pressure, thanks to flat incomes and rising living costs – and some lifts in mortgage rates.

Posted on 03 March 2017

More than 1 million Australians face mortgage strife

Exclusive analysis performed for AFR Weekend has revealed that more than a million Australian home owners will struggle with mortgage stress if interest rates were to rise just three percentage points. Data from research house Digital Finance Analytics shows that close to one in three households from Victoria, Tasmania and Western Australia

Posted on 03 March 2017

Latest Greater Sydney Mortgage Stress Mapping

Following on from yesterday’s post, where we listed the post codes with the largest number of currently mortgage stressed households, we will now go into more detail across the main states. We commence this journey of pain by looking at NSW, where of course home prices have risen strongly, mortgages are large, and incomes static.

Posted on 04 March 2017

Latest Greater Brisbane Mortgage Stress Mapping

We continue our series on mortgage stress mapping by looking at our results across QLD, with a focus on Brisbane. You can read about our approach to mortgage stress modelling here. Harristown 4350 leads the list with more than 4,000 households caught. Harriston is about 109 kms from Brisbane near Toowoomba

Posted on 06 March 2017

Latest Greater Melbourne Mortgage Stress Mapping

We turn our attention to VIC and Greater Melbourne with the latest mortgage stress mapping. Read about our approach here. We are looking at owner occupied loans, with data to 1st March 2017. First here are the top twenty post codes across Victoria with the largest numbers of households in mortgage stress.

Posted on 07 March 2017

Latest Greater Perth  Mortgage Stress Mapping

We now look across to the west, with mortgage stress modelling across WA, and mapping in Greater Perth. Read about our approach here. The postcode with the higher number of households in mortgage stress in WA is Merriwa 6030, a suburb of South Western, Heartlands and  about 35 kms from Perth.

Posted on 08 March 2017

Mortgage Stress Analysis Using the DFA Market Model

Today we walk through the mortgage stress data contained in the model. Mortgage stress has been featured in quite a few recent posts but now we examine …

Posted on 30 March 2017

Mortgage Stress Rises Again

The latest results from the Digital Finance Analytics mortgage stress modelling, released today, reveals another rise in the number of households experiencing mortgage stress.

Posted on 04 April 2017

Getting To Grips With Mortgage Stress

Within our household data we have information on the drivers of mortgage stress, the symptoms of stress and how households are mitigating mortgage stress. Today we explore this data.

Posted on 11 April 2017

Tracing The Rise of Mortgage Stress

Today we take a longer term view of the rise of mortgage stress, which is driven by a combination of larger mortgages, flat incomes, higher living costs and rising debt. The first chart tracks household debt to disposable income from the RBA, as well as mortgage rates, the cash rate and both CPI and wage growth.

Posted on 15 April 2017

Latest on Victorian Mortgage Stress

Today’s coverage in the Herald Sun looking at sensitivity analysis of mortgage stress in Victorian households received significant attention. Several tv news programmes tonight will continue the coverage.

Posted on 24 April 2017

Nine News Does Mortgage Stress

Segment on Nine News which incorporates latest research from our mortgage stress modelling as well as research from

Posted on 24 April 2017

Seven News Melbourne Does Mortgage Stress

Segment on Seven Melbourne, citing the research we did for the Herald Sun on mortgage stress by post code and sensitivity to rising interest rates.

Posted on 24 April 2017

Check out our extensive recent media coverage.


Author: Martin North

Martin North is the Principal of Digital Finance Analytics