Aspirational Dutton Park tops list of 19 mortgage-stressed inner-Brisbane suburbs
Households in Dutton Park, just south of the Brisbane CBD, are spending more than half (54%) of their income on repaying their mortgage, according to analysis of census 2011 data by Brisbane-based firm Resolution Research.
Borrowers are said to be in mortgage stress and at higher risk of defaulting on their mortgage if they spend more than a third of their household income on making monthly mortgage repayments.
Households in Dutton Park, about four kilometres south of the Brisbane CBD, earn around $4,500 per month and spend nearly $2,200 of this on servicing their mortgages, according to 2011 census data.
This is a 38% increase on the $1,600 they spent on mortgage repayments, according to the 2006 census.
Over the same period, household income has not kept pace with increasing mortgage repayments – five years ago monthly income was just under $3,950, meaning household income has risen only 14% between 2006 and 2011.
Diana Howes, managing director at Resolution Research, says Dutton Park is an example of residents being willing to make sacrifices on big ticket items to be able to afford to live in the suburb.
"Dutton Park is very unique suburb being just a five minute drive to CBD with both city and river views and full of character housing that can't be redeveloped.
"There have been very few changes in its dwelling typology landscape.
"It's a very constrained supply environment – and one of the most desirable suburbs to live in the city."
Howes says Leighton Properties' development of the master-planned Boggo Road Urban Village alongside the heritage-listed Boggo Road Gaol has stimulated price growth.
The median house price in Dutton Park is $745,000 compared with $548,000 in 2007, an increase of 36%, according to RP Data.
Using the same census data, renters pay around $240 per week ($1,080 per month), suggesting renting in Dutton Park is far less of a burden on household finances.
However, more recent rental data compiled by RP Data suggests rents have risen rapidly in Dutton Park since the census and have almost doubled to $475 per week.
Across Brisbane, Resolution Research found that nearly one in two (49.2%) Brisbane households under or on the verge of household stress spending between 30 and 39% of their median household incomes on mortgage repayments.
This ratio is matched in the sought-after inner-Brisbane market, currently the focus of dozens of new apartment projects.
Mortgage stress is high in Woolloongabba (44% of household income goes to repaying the mortgage) followed by St Lucia (41%).
Other mortgage-stressed inner-city suburbs include South Brisbane, Hamilton, Fortitude Valley and New Farm.
Howes believes that the current definition of housing stress needs to be adjusted.
"Forty percent of income to service a mortgage would be a better guide," she says.
Name | Household income (w) | Mortgage repayment (m) | Mortgage/ Income |
$1,004 | $2,167 | 54% | |
West End | $1,485 | $2,597 | 44% |
$1,330 | $2,200 | 41% | |
St Lucia | $1,315 | $2,167 | 41% |
$1,360 | $2,123 | 39% | |
$1,494 | $2,167 | 36% | |
Windsor | $1,644 | $2,383 | 36% |
$1,380 | $2,000 | 36% | |
Everton Park | $1,346 | $1,950 | 36% |
Annerly | $1,385 | $2,000 | 36% |
$1,458 | $2,100 | 36% | |
Coorparoo | $1,522 | $2,151 | 35% |
Albion | $1,493 | $2,104 | 35% |
Newmarket | $1,565 | $2,200 | 35% |
$1,588 | $2,210 | 35% | |
Hamilton | $1,894 | $2,600 | 34% |
Fortitude Valley | $1,590 | $2,179 | 34% |
New Farm | $1,620 | $2,200 | 34% |
Toowong | $1,601 | $2,167 | 34% |
Milton | $1,798 | $2,400 | 33% |
Red Hill | $1,909 | $2,500 | 33% |
Kangaroo Point | $1,679 | $2,167 | 32% |
$1,696 | $2,167 | 32% | |
$1,698 | $2,167 | 32% | |
Spring Hill | $1,613 | $2,058 | 32% |
Paddington | $2,074 | $2,557 | 31% |
Balmoral | $2,044 | $2,500 | 31% |
Fairfield | $1,525 | $1,863 | 31% |
$1,795 | $2,167 | 30% | |
Hawthorne | $2,101 | $2,500 | 30% |
Grange | $2,097 | $2,375 | 28% |
$2,110 | $2,383 | 28% | |
Ashgrove | $2,083 | $2,340 | 28% |
Newstead | $2,480 | $2,766 | 28% |
Bardon | $2,287 | $2,492 | 27% |
The Gap | $1,937 | $2,100 | 27% |
Bulimba | $2,410 | $2,600 | 27% |
$2,049 | $2,167 | 26% |
Source: Resolution Research
Dutton Park photograph courtesy of Flickr.
This article is under dispute, as property analyst Michael Matusik has disagreed with its findings.