Digital Finance Analytics (DFA) Blog
"Intelligent Insight"
From The AFR. Costs for many homebuyers have jumped by up to 150 basis points over the past 12 months and are expected to continue rising even if low inflation means an official rate hike from the Reserve Bank of Australia is unlikely in the near term. Owner-occupier borrowers are paying between 30 and 40 … Continue reading “Why a small rise in interest rates will hurt like the 1980s”
On of the drivers of mortgage stress, which continues to rise, is flat and falling income growth. This phenomenon is hitting other economies too, such as the UK. So, today’s speech from RBA Governor Philip Lowe is timely – The Labour Market and Monetary Policy. This speech covers trends in employment and wages in Australia, … Continue reading “Will Wages Rise Any Time Soon?”
The Reserve Bank held the cash rate, more banks hiked mortgage interest rates, household debt rose again and our latest research showed that more than 800,000 households across Australia are experiencing mortgage stress. Welcome to the latest edition of the Property Imperative Weekly. HSBC said the housing bubble fears were overblown. At a national level, … Continue reading “Inequality Rules – The Property Imperative Weekly 8th July 2017”
The latest RBA E2 – Households Finances – Selected Ratios – data has been released. The inexorable rise in debt continues. No wonder mortgage stress is rising. The ratio of household debt to annualised household disposable income , rose to 190.4, the ratio of housing debt to annualised household disposable income rose to 135, and … Continue reading “Household Debt Busts the 190”
Data this week showed the impact of ever higher mortgages, with more households in debt for longer, and thanks to rising property prices, more households cannot get even into the market and are forced to rent. Welcome to this week’s edition of the Property Imperative. This week we had the first look at the latest … Continue reading “Hung Out To Dry – The Property Imperative Weekly – 1 July 2017”
More pain for property investors this week, with lenders continuing to lift mortgage rates and trim maximum LVR’s. And more pain for banks as their credit ratings are trimmed, the federal bank tax becomes law; and South Australia imposes an additional levy on the big five. Welcome to the Property Imperative Weekly to 24th June … Continue reading “The Property Imperative Weekly – 24 June 2017”
From The SMH. There is a hidden and worrying risk lurking for a particular set of mortgage borrowers, whose level of financial stress is about to get a whole lot worse. It’s those home owners with interest-only loans that are now increasingly under the pump – with National Australia Bank the latest of the big … Continue reading “Not in their interest: The home loan borrowers that have been left out to dry”
Household financial pressures continue to build as the costs of energy rise, under employment lifts to a record and interest rates climb. Welcome to the Property Imperative weekly to 17th June 2017. Power bills will soar by hundreds of dollars next month in east coast states, and experts blame policy uncertainty in Canberra. Two major … Continue reading “Households Budgets Under Pressure – The Property Imperative Weekly 17 June 2017”
The evidence is mounting that the property cycle is on the turn, and the question now is – will it be a gentle retreat or a blood bath? In this week’s edition of the Property Imperative we consider the evidence. At the start of the week we got the latest auction clearance rates which showed … Continue reading “Into The Unknown – The Property Imperative Weekly – 10th June 2017”
The latest chart pack from the RBA to June 2017 includes the worrisome chart on household debt levels. No sign of a change in trajectory, despite low wage growth and some lending tightening. The last available data point on household debt to income is 188.7 from December 2016. The March data should be out soon … Continue reading “Household Debt Rising Further – RBA”