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Mortgage stress improves but more rate cuts needed

Staff Reporter 1 minute read

Rate cuts and tax changes have eased borrowers’ mortgage stress but the threat of rising unemployment could scupper any improvements, Fujitsu Consulting warned today.

According to Fujitsu, the number of households suffering mortgage stress fell by 10 per cent in September to 800,000.

Those in severe stress fell by 19 per cent to 256,000.

Martin North, managing consulting director at Fujitsu Consulting, said however that this would be overshadowed by forward projections of rising unemployment.

“The net result is a significant rise... to over one million households suffering some degree of mortgage stress by March 2009, and a 42 per cent rise in sever stressed households thanks to increasing household costs, credit debt and job losses,” Mr North said.

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“There is a strong case for further cash rate reductions to offset this.”

Published: 22-10-08

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