Fairfield-Liverpool is fifth worst-performing region in Australia for mortgage repayments
AFTER seven consecutive years of being the worst-performing region in Australia for on-time mortgage repayments, Fairfield-Liverpool is now fifth worst.
The 2.82 per cent decrease from March 2012 was two and a half times the national average reduction.
Even though decreases in mortgage rates during the last year have benefited repayment performance, the region remains one of the five worst performing in the country.
The Fitch Ratings Australian Mortgage Delinquency by Postcode report recorded mortgage defaults of up to 90 days for Green Valley in the Liverpool local government area. It was ranked 11th in the worst-performing suburbs in the country. Smithfield and Wetherill Park in the Fairfield local government area were listed as the 38th worst performers by postcode nationally.
The report identified the main risk to household affordability to be the increasing cost of living.
It also found the unemployment rate to be key factor in mortgage performance.
The unemployment rate recorded for Fairfield-Liverpool reached 7 per cent in December last year, a slight decrease from the 7.7 per cent recorded in March, 2012.
Data from the Australian Bureau of Statistics found the average wage earned locally was well below the state average. The bureau reported 15 per cent of households required more than 30 per cent of their income to service their mortgage debt.
Fairien Azeem, a financial adviser for Mortgage Choice Liverpool, said some homeowners overextended themselves.
"When homebuyers first apply for their loan, they often overstretch their commitment," she said.
"It could stem from not getting the right advice to begin with. Generally it is recommended that a deposit of at least 5 per cent to 10 per cent of the purchase price is available before making any long-term commitment — and that is exactly what a home loan is: a 20- to 30-year financial commitment."
Mrs Azeem said once homeowners found themselves in strife, they shouldn't waste any time referring the problem to their bank or broker.