❓ A parliamentary question regarding Keystart's data on negative equity and customer churn, with the Minister providing a response outlining Keystart's monitoring practices and refinancing figures.
AnsweredQoN 553Legislative Council
QuestionView source ↗
KEYSTART —
NEGATIVE EQUITY
553. Hon PETER COLLIER to
the minister representing the Minister for Housing:
I refer to the Keystart home loan
scheme.
(1) Does Keystart keep information
or estimates on the number of loan holders in negative equity?
(2) If yes to (1), what is the
number or estimated number of Keystart clients in negative equity?
(3) What is the
number of clients who have churned from Keystart to other banks for each of
2015–16, 2016–17, 2017–18, and 2018–19 to date?
NEGATIVE EQUITY
553. Hon PETER COLLIER to
the minister representing the Minister for Housing:
I refer to the Keystart home loan
scheme.
(1) Does Keystart keep information
or estimates on the number of loan holders in negative equity?
(2) If yes to (1), what is the
number or estimated number of Keystart clients in negative equity?
(3) What is the
number of clients who have churned from Keystart to other banks for each of
2015–16, 2016–17, 2017–18, and 2018–19 to date?
AnswerView source ↗
I thank the Leader of the Opposition for some notice of the
question.
(1)–(2)
Like all lenders, Keystart is regulated by the Australian Securities and
Investments Commission. Although Keystart monitors changes in property prices
in the market and their impact at a portfolio level, it does not track specific
property values or negative equity for each borrower. It does not publicly
release the details of borrowers in negative equity—a similar policy to
that adopted by other lenders—in order to protect our borrowers'
privacy and as property values and loan balances change. As is the case for all
property owners, market cycles affect property values. At various times across
the life of a home loan, the value of the property compared with the
outstanding loan amount will fluctuate. The success of Keystart since its inception
30 years ago indicates the willingness of its clients to take a long-term view
of home ownership and successfully pay down their mortgages and sustain home
ownership throughout market cycles.
(3) Below is
the number of Keystart borrowers who have refinanced, where they have disclosed
the financial institution in each of the requested years. This data is based on
the information the borrower has provided Keystart. Some customers choose to
not disclose this information when they discharge their mortgage with Keystart.
The figures are as follows: 1 924 in 2015–16; 1 451 in 2016–17;
1 011 in 2017–18; and 739 in 2018–19, year to date.
question.
(1)–(2)
Like all lenders, Keystart is regulated by the Australian Securities and
Investments Commission. Although Keystart monitors changes in property prices
in the market and their impact at a portfolio level, it does not track specific
property values or negative equity for each borrower. It does not publicly
release the details of borrowers in negative equity—a similar policy to
that adopted by other lenders—in order to protect our borrowers'
privacy and as property values and loan balances change. As is the case for all
property owners, market cycles affect property values. At various times across
the life of a home loan, the value of the property compared with the
outstanding loan amount will fluctuate. The success of Keystart since its inception
30 years ago indicates the willingness of its clients to take a long-term view
of home ownership and successfully pay down their mortgages and sustain home
ownership throughout market cycles.
(3) Below is
the number of Keystart borrowers who have refinanced, where they have disclosed
the financial institution in each of the requested years. This data is based on
the information the borrower has provided Keystart. Some customers choose to
not disclose this information when they discharge their mortgage with Keystart.
The figures are as follows: 1 924 in 2015–16; 1 451 in 2016–17;
1 011 in 2017–18; and 739 in 2018–19, year to date.
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