Fitch Ratings is doubtful that the 2.25% rate set by the Reserve Bank of Australia can have any remarkable impact on the performance of domestic residential mortgage loans.
 
Despite the move contributing to the lowest rate in 50 years, Fitch Ratings argues that there is little room for further improvement in mortgage performance in terms of loan defaults and delinquencies.
 
Fitch data found the delinquency rate of loans with more than 30 days past on residential mortgages now to be just 1.08%, the lowest recorded since December 2007.
 
However, the ratings agency said it is still vigilant for over-commitment of borrowers and poor underwriting in the mortgage market, “although there is little evidence of such practices now”.
 

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