More households are struggling to meet their mortgage payments, raising concerns among analysts.

ANZ this week released its first-half results, which showed that as of March, 5 per cent of the bank’s home loans were in negative equity, non-performing loans have increased and there had been a rise in mortgages more than 30 days due.

ANZ boss Shayne Elliott said the bank was keeping an eye on its loan book as families were increasingly feeling the pinch.

“Wage growth is stubbornly low … so we’re worried about families doing it a little bit tough at the moment,” he said.

ANZ boss Shayne Elliott said the bank was keeping an eye on its loan book. Photo: AAP

“We saw 500 or 600 families in this half [year] get themselves into difficulties in terms of not being able to keep up with their payments.

“That’s a lot higher than we’ve seen in the past. So the question is: is this a trend? Is it a blip?”

His comments were followed by NAB’s first-half results which showed that an increasing number of its customers were in arrears of more than 90 days.

Economist Martin North from Digital Finance Analytics, says the number of households in mortgage stress is concerning.

“Mortgage stress is continuing to rise – we’ve got one million households across the country currently in mortgage stress,” he told The New Daily.

“Unfortunately it’s a combo of flat incomes, big mortgages – because home prices were so high – we’ve got some of the highest debt-to-income ratios in the world. We’ve also got the issue of underemployment, people have multiple part-time jobs.

“This is a long-term, building problem. Mortgage stress is a lead indicator of more defaults later. It takes people years to refinance, put more on credit cards until they get to the point they can’t manage anymore and they try to sell.”

Far from a crisis

But Moody’s banking analyst Frank Mirenzi says people should “be aware but not alarmed”.

“Delinquencies are on the rise and it’s relatively broad-based,” he told The New Daily.

“Previously, we’ve seen them rising in Western Australia and in Queensland, but you had them declining in New South Wales, now that trend is reversing and they’re rising in New South Wales and Victoria.”

The rates of defaults will continue to rise throughout the next year, Mr Mirenzi argues.

“For the next year and a half they’re set to rise, it’s coming through and it’ll continue for a little while to come – definitely 18 months or so.”

While the levels are concerning, he says that we are far from a “stress event”.

“The current level of arrears that you see specifically in WA is kind of what you might expect for a stress event – they’re over 2 per cent. When you look at the rest of the country, though, it’s under 1 per cent. We are quite far away from a stress event.

“I think the thing to remember is, the trend is negative but the starting point was pretty good, so we aren’t in stress territory – we are a long way from that – even though it’s negative.”

How to beat the stress

To avoid mortgage stress households need to do thorough budgets so they know exactly what they’re spending, says Mr North.

“Households have no idea what they’re spending, so my advice would be to draw up a budget so you know what you’re doing,” he said.

“Stop spending on credit cards, with high interest rates because what you’re doing is essentially paying the bank the high rates and not dealing with debt.

“Refinancing is not a very suitable path either, you need to trim your expenditure because you can’t go on using the mortgage as an ATM, especially in a falling market because it means disaster later.”