PHOTO: RAWPIXEL
The surge in the number of Kiwi families grappling with the cost of living crisis is evident, as indicated by recent data highlighting a substantial increase in individuals falling behind on their mortgage payments.
The latest report from Centrix reveals a growing trend of New Zealanders failing to meet their mortgage obligations promptly. In November, Centrix reported an alarming figure of over 19,200 overdue mortgage accounts, marking a 25 percent year-on-year increase.
The repercussions of the cost of living crisis are also reflected in the ongoing trend of refinancing loans at higher interest rates. Centrix cautions that this financial strain may persist well into 2024.
The report further notes a surge in demand for credit cards, buy now, pay later schemes, and personal loans in November, particularly around Black Friday. Despite families tightening their budgets due to increased living costs, credit inquiries have not diminished, suggesting that Kiwi households may be strategically managing cash flow by taking advantage of discounted prices before Christmas.
However, the report also raises concerns about a segment of the population stretching beyond their means, potentially leading to financial troubles in 2024. Centrix advises those struggling with repayments to communicate with their credit providers, establish a payment plan, and consider seeking assistance with budgeting.
The economic challenges persist for businesses, with company liquidations remaining high, especially among small and medium-sized enterprises facing rising credit defaults. The overall economic climate indicates potential difficulties for many as they approach the summer season.