16th April 2009

The Sunshine Coast has the third highest bankruptcy rate in the state.

 

People on the Gold Coast will account for 20% of personal bankruptcies filed in Queensland, according to the first statistics for 2009 from SV Partners.

 

And chartered accountant director Jason Cronan has predicted there is no respite for at least the next two years.

 

The Coast’s shocking figures come in third on the SV Partners Insolvency barometer, which predicts quarter figures due for release from the federal government’s Insolvency and Trustee Services Australia barometer.

 

In “first” place is the Gold Coast, with a stunning 50% followed by Brisbane, with 25%.

Mr Cronan said the figures revealed that far too many people were excessively relying on credit and over-committing on property.

 

He said there was no need for such risk, despite the current economic climate.

“Our figures show that trades and construction are the biggest areas affected by these figures,” Mr Cronan said, explaining “personal” bankruptcy also covered individually-run businesses.

 

“That could be because of a skill set, where you might have a greater builder who isn’t so good at collecting the debts.”

 

National bankruptcy figures this quarter have increased by 13.6% over the same period

last year.

 

South Australia and the Northern Territory were the only places to record a decline in the number of individual insolvencies.

 

“A large reason for the appearance of all three regions at the top of the figures is due to their population,” Mr Cronan said.

 

“The Sunshine Coast, to an extent of the other two, also has a large number of people who move to the region to invest in small business.”

 

Mr Cronan said investment failure was linked to poor market information, a lack of clear boundaries financially and knowing when to cut and run.

 

“It’s critical that you get good financial advice, that you stick to your budget and that you don’t over-commit yourself to projects,” he said.

“These figures are cyclical, of course, but it will be another two years at least before we could see any real change.”