Resource-dependent Western Australia is driving the nationwide spike in Aussies falling behind on their home loan repayments, states a new report from Standard & Poor’s. The percentage of home loans in arrears in Western Australia has increased to 2.1% of mortgages in December 2016, up from 1.5% a year earlier, according to the report. 

The S&P report only looked at loans in residential mortgage-backed securities transactions, which accounted for approximately 5% of all outstanding home loans, but are considered representative of the broader market.

The resource-dependent states of Queensland and Western Australia are home to eight of the 10 postcodes with the greatest proportion of home loans in arrears nationwide, the report revealed. High unemployment, lower wage growth, and declining property prices are creating significant mortgage stress in Western Australia, as evidenced by the state’s higher arrears.

Moreover, S&P said it doesn’t expect the recent rise in commodity prices to significantly boost investment or employment in the resources sector. This means the spike in arrears is likely to persist for some time in the state, as the downturn in mining investment continues to unfold.

Not surprisingly, New South Wales and Victoria had the lowest rate of mortgage arrears at 0.86% and 1.08% respectively. The lower rates of mortgage arrears in these states helped to offset the higher rates experienced in states and territories with more exposure to the global demand for resources.

The national level of mortgages more than 30 days in arrears was 1.15% in December, up from 1.14% in September. This is well below the historic peak of 1.69%.

Listed here are the top ten postcodes with the highest percentage of mortgages in arrears:

Postcode, state Percentage of mortgages in arrears
Ballaroo, Queensland 6.23%
Alexandria, Queensland 5.42%
Butler, Western Australia 5.12%
Armstrong Beach, Queensland 5.07%
Whyalla Norrie, South Australia 4.91%
Jimboomba, Queensland 4.71%
Bucasia, Queensland 4%
Kurunjang, Victoria 3.99%
Bayswater, Western Australia 3.99%
Alexandra, Queensland 3.98%
    Source: Standard & Poor's