Melbourne dominates the best-performing regions, with five of the top six locations led by northern middle Melbourne (suburbs like North Melbourne, Kensington, Ascot Vale) with an arrears rate of just 0.55% compared with a rate of 0.7% six months ago.
The affluent lower northern Sydney market (including million dollar suburbs like Cremorne, Kirribilli and Neutral Bay) ranks second with a 30 days plus arrears rate of 0.56%, up from 0.63%.
Commenting on the national improvement in the delinquency rate, Nomura banking analyst Victor German says the sharp but consistent improvements seen in delinquency rates coincide with the 50-basis-point and 25-basis-point interest rate cuts announced by the RBA in May and June 2012, respectively.
“With further 25-basis-point interest rate cuts put through in Oct and Dec 2012, we will be looking for signs of further improvement in delinquency rates during the upcoming reporting season,” German says.
On a state-by-state basis, Queensland has the highest arrears rate (1.41%), followed by NSW (1.25%), WA and Tasmania (1.2%) and South Australia (1.19%). The remaining states are all below 1%.
This article first appeared on Property Observer.
