Westpac has reported a rise in the number of people missing mortgage payments amid a sluggish economy and a soft housing market.
Australia’s second-largest bank on Monday said 90-plus-day delinquencies, the overall percentage of loans about three months overdue, were up eight basis points over the third quarter to 0.9 per cent.
The country’s housing market has been under immense strain, with housing prices having fallen every month since late 2017.
But recent encouraging signs in June from Sydney and Melbourne, and interest building from Chinese buyers, a key base, have spurred hopes that things may be improving.
“Softness in property market contributing to an increase in the time it takes to sell a property have contributed to the rise in delinquencies and properties in possession,” Westpac said in a statement to the ASX.
Properties in possession now sit at 550, a jump of 68 over the quarter.
Many hope back-to-back Reserve Bank rate cuts in June and July will boost consumer sentiment across the housing market, which may also get a lift from recently passed tax cuts.
The proportion of assets classified as stressed rose in the third quarter by 10 basis points to 1.2 per cent, the lender said in a limited third-quarter update.
The Sydney-based lender’s common equity Tier 1 capital ratio, a measure of the bank’s core equity capital, inched down to 10.5 per cent at the end of June from 10.6 per cent at March 31.