Centrix says 458,000 people are behind on their consumer payments. File photo. Photo: nito500/123RF
The number of people behind on their mortgage repayments fell for the second straight month in April, although the level of arrears is still up 14 percent from last year.
Data from credit bureau Centrix shows 21,700 people were behind on home loan repayments, or 1.45 percent of all home loans, compared to 1.48 percent in March.
Overall consumer arrears also eased slightly to 12.52 percent of active borrowers, from 12.7 percent a month earlier.
Centrix said 458,000 people were behind on their payments, down from 463,000.
Managing director Keith McLaughlin said some of the fall was seasonal, but households were also adapting to the higher cost of servicing debt.
"Consumers have adjusted their household budgets," he said.
"I think what we traditionally see in this time of year, there is a reduction in arrears once we get through Christmas."
Arrears typically increased after Christmas, as consumers picked up more debt as they spent more on discretionary items.
Consumer credit demand rose 2.3 percent from a year ago, but McLaughlin said growth had slowed.
Vehicle finance demand had fallen 20 percent due to falling new car sales, and mortgage applications were also slightly down amid the flat housing market and high interest rates.
Liquidations spike
Centrix said the tough economic conditions remained challenging for the business sector, with liquidations up 19 percent year-on-year.
It said 193 business liquidations were recorded in April, with 14 in manufacturing - the highest rate for the sector in five years.
McLaughlin said he has heard a lot of concern from the business sector.
"If consumers are pulling back on their discretionary spending, it's impacting the revenue businesses have, particularly in areas such as hospitality and retail, building and construction, and now we're seeing it in areas such as manufacturing," he said.