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Economists predict the number of Australians likely to default on their home loans this year will increase because of rising interest rates, massive credit card debt and falling house prices.
Research by JP Morgan and Fujitsu Consulting quoted in Fairfax publications suggests 750,000 home owners will be hit by 'mortgage stress' in the coming months.
It is anticipated up to 300,000 of those will default on the loan and could have their homes repossessed.
JP Morgan spokesman Brian Johnson says one of the factors driving the problem is massive credit card debt.
"The fact is, the average household in Australia [spends] over three months of its disposable income on credit card debt," he said.
"The other thing is that in Australia we only have a system of negative credit reports, which means the credit bureaus only capture people who are defaulting on their credit card.
"There's no data captured about the actual total dollar value of debt."
- RADIO AUSTRALIA
