According to data analytics company illion, 32,350 Australians have declared bankruptcy in the 2018 financial year, marking a 4 per cent increase.
“The lights are flashing red across several regions in terms of rising consumer stress levels,” illion chief executive Simon Bligh said, pointing to rising levels of debt, falling house prices and anaemic wage growth as culprits.
“Sydney’s declining property market and the significant rise in personal bankruptcies could be mirrored in Melbourne in FY2019, as its property market is showing signs of following the same downwards trajectory.
“At the same time, economies in Western Australia and Queensland have turned a corner recently, with property markets stabilising and resurgent resources prices. Yet according to our analysis, a significant number of households are still doing it tough in these states.”
Illion’s analysis of official bankruptcy data found that Queensland had the most bankruptcies (9,415), up 1.5 per cent over the last 12 months. The sunshine state was also home to five of the top 10 suburbs for personal insolvency.
WA had the most severe increase, up 11.7 per cent to 4,130 personal bankruptcies, and is also home to Baldivis, the suburb with the highest number of bankruptcies (105).
However, Victoria actually saw its annual bankruptcy rate fall by 2.2 per cent.
While the rate is trending upwards, Mr Bligh said Australians should be careful about going down that path.
“Bankruptcy has long-term effects on a person’s financial position such as impacting their ability to borrow or even rent a home. We encourage anyone who is experiencing financial hardship to seek help from a financial counsellor,” he said.