The recap of this weeks mortgage, home loan and housing news in Australia.

The top stories for the week ending 27/04/08:

Mortgage stress levels could rise: study
The Age
In June Fujitsu Consulting released their monthly Mortgage report indicating that 750,000 borrowers would be facing ‘mortgage stress’. In their latest report that figure has been raised to one million borrowers out of the six million in Australia will be in trouble by next year. View Story »

Are Mortgage stress levels overstated?
Background Notes for Opening Remarks to Senate Select Committee on Housing Affordability in Australia
The RBA
Ric Battellino, the Reserve Bank Deputy Governor, spoke to a senate inquiry this week indicating that measures of mortgage stress may be out of date and applied incorrectly. The widely used benchmark for mortgage stress, being repayments exceeding 30% of income, dates back to 1991/92 and applied to households in the bottom 40% of income. The RBA estimates that about 30,000 households are between 30 days and 90 days in arrears and 15,000 are 90 days or more in arrears.

The Deputy Governor pointed to house prices which have risen by over 180% since the mid 1990’s a time when interest rates where also at similar levels to today. View Publication [PDF] »

Rates on the rise
News.com.au
Terry McCrann wites “It’s extremely finely balanced. But the Reserve Bank is likely on that balance to leave interest rates unchanged in 12 days’ time.” on the news that inflation has hit 4%. View Article »

Fighting back against rate rises
The Australian
John Symond, CEO of Aussie Home Loans, reveals in an article directed at financial planners that many people may not be on the best deal possible stating that “our research shows that more than 50 per cent of customers who speak to an Aussie adviser do not have the best home loan deal.” and that many who refinance see save up to 0.75 per cent on the standard variable rate. View Article »

RBA greases wheels of credit with $1bn
The Australian
The Reserve Bank has taken $780 million in mortgage bonds onto its books following a recent $320million investment in a bid to revive the market for mortgage-backed bonds reports David Uren. View Story »

Reserve ‘must lift inflation target’
The Australian
Bernie Fraser, former Reserve Bank Governor, and Professor Bob Gregory, former Reserve Bank board member, have raised concerns over strictly adhering to a 2-3 per cent inflation target when the China-led resources boom was forcing up food and fuel prices fearing it could lead to recession. View Article »

Home prices dip as rates bite
The Age
MELBOURNE house prices have fallen 8.4% recording their biggest quarterly fall in value since 1993 as interest rate rises and fears of a slowing economy dull buyers’ appetites for homes reports Eli Greenblat. View Story »