Big rise in mortgage stress in the City of Wanneroo

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Financial data shows households in 20 Wanneroo suburbs are suffering a high rate of mortgage stress. File picture

MORTGAGE stress is a growing crisis in the City of Wanneroo with financial data and financial counselling statistics painting a bleak picture especially since Covid-19 support payments have stopped or been reduced.

At a special council meeting to pass the City of Wanneroo 2021-22 Budget on June 29 councillors Hugh Nguyen and Vinh Nguyen were unsuccessful in their efforts to get their colleagues to keep a 0 per cent increase in rates for the second year in a row.

The two South ward councillors cited data about the high rate of mortgage stress in 20 suburbs in the City of Wanneroo and anecdotal information supplied to them by ratepayers, who were struggling financially, to justify their opposition to any rate increase this financial year.

This week statistics from a Uniting WA financial counselling service which sees clients from all over the City of Wanneroo reinforce how dire the situation is for some with almost 40 per cent of those visiting its Yanchep counselling service in the six months to June 30 citing mortgage stress as an issue.

Alarmingly of those citing mortgage stress as an issue 10 per cent were facing imminent homelessness.

While arguing against the rate increase Cr Hugh Nguyen referenced a May Digital Finance Analytics household survey showing the most mortgage stress was in high growth corridors in WA (the 20 City of Wanneroo suburbs plus two City of Swan suburbs) and Victoria.

Suburbs where households said they were experiencing high levels mortgage stress included Ashby, Darch, Gnangara, Hocking, Jandabup, Landsdale, Madeley, Mariginiup, Pearsall, Pinjar, Sinagra, Tapping, Wangara and Wanneroo.

Clarkson, Merriwa, Mindarie, Quinns Rocks, Ridgewood and Tamala Park – where 6631 households were experiencing a higher level of mortgage stress – were also on the list.

Uniting WA acting chief executive officer Michael Chester said clients accessing support from financial counselling services in Yanchep cited a wide range of factors contributing to their financial problems, but most notable was the issue of mortgage stress and home loan arrears, coupled with an end to financial hardship support from creditors which had been provided during the height of the Covid crisis.

“With Jobkeeper and the financial hardship support offered by creditors during the height of Covid having now been withdrawn, many homeowners who were already struggling to make ends meet are now facing the very real prospect of losing their homes,’’ he said.

“Uniting fully supports the introduction of responsible lending laws that protect consumers from the burden of excessive debt.”

During the special council meeting to pass the city’s Budget councillors said the city’s hardship policy was there to support ratepayers who were struggling financially.

But the 2021-22 Budget allows for a reduction in the city’s Covid-19 response and recovery packages with debt write-off and hardship allowances reduced by $3m and economic development by $155,000.

The city’s hardship policy allows eligible residents to apply to have interest and fees incurred on overdue rate payments waived in order to relieve financial stress.

Back in 2018 Yanchep News Online reported on insolvencies in the City of Wanneroo and how the McGowan Government responded by boosting free financial counselling services in high-need areas, which at the time included Alkimos and Yanchep.