Big Four banks offer a mortgage payment HOLIDAY during coronavirus chaos – amid warnings house prices will drop 10%
- Thousands of Aussies are losing jobs and coronavirus hammers the economy
- ANZ CEO Shayne Elliott said today the bank is ‘ready and able’ to help
- Westpac, NAB and Commonwealth have also said they will step in
- Mortgage repayment holidays means not paying for a period of time
- Coronavirus symptoms: what are they and should you see a doctor?
Australia’s banks are offering mortgage payment holidays to thousands of customers whose incomes are impacted by the coronavirus-caused downturn.
ANZ CEO Shayne Elliott said today the bank is ‘ready and able’ to help struggling customers by pausing their payments.
Westpac, NAB and Commonwealth have also said they are prepared to defer repayments.
It comes as thousands of jobs are axed, including 20,000 Qantas roles, as coronavirus affects the travel, education, tourism and entertainment industries.
Australia’s banks are offering mortgage payment holidays to thousands of customers whose incomes are impacted by the coronavirus-caused downturn
On Tuesday banks in the UK agreed to pause eligible customers’ payments for three months.
The monthly payment changes to zero, and interest accrues for the period.
Nigel Stapledon, Research Fellow in Real Estate at UNSW, said it was in everybody’s interest for Australian banks to follow suit.
‘People’s incomes are going to take a hit. Banks don’t want to push people into selling,’ he told Daily Mail Australia.
‘It’s in everyone’s interests to adopt measures to get us through the next six to twelve months, or however long this lasts.’
‘This is not like major recessions in the 80s and 90s when unemployment remained high for a long time afterwards. This is a short, sharp shock and we can return to better circumstances once it’s over.’
Dr Stapleton, who was Westpac’s chief economist from 1993-2003, said house prices would likely come down by five to 10 per cent due to the knock-on effects of the coronavirus.
‘Buyers will drop out but sellers will pull back so we are likely to see reduction in activity in the housing market,’ he said.
‘People who need to sell now might see growth over the last few years walk out the door.’
Dr Stapleton said helping homeowners is sensible but it would be harder for the government to help renters.
He said a freeze on rents would not help because rents are actually coming down.
‘If I were a renter I would be more concerned with assistance on the income side, for example helping me keep my job, rather than the complication of doing something on rental side,’ he said.
‘We cant fully mitigate all the impacts – that’s impossible. You cant compensate everyone,’ he said.
ANZ CEO Shayne Elliott told 2GB radio’s Money News on Wednesday night: ‘There is light at the end of the tunnel.
‘Our job at the bank is that customers survive whatever that period is – whether it’s three months, or six months, or longer.
‘Banks have record levels of capital, more liquidity and we’re ready and able to assist customers through that.’
Shadow Treasurer Jim Chalmers said he supports measures to take economic strain away from Australians.
‘I’m confident the lenders are examining all their options to make life easier for their customers, including small businesses,’ he told Daily Mail Australia.
The Treasury, which is expected to announce a second stimulus package – rumored to be of a similar amount to the initial $17billion – has been contacted for comment.
Nigel Stapledon, Research Fellow in Real Estate at UNSW, said it was in everybody’s interest for Australian banks to defer repayments