How The RBA Wants To Slow The Property Market Down

One of the the Hot Topics currently is how interest rates have

recently dropped, but in the background the RBA has expressed

it’s fears that lower interest rates will result in a Property Bubble.

With interest rates a key player in market activity, the RBA

in conjunction with APRA (the banks’ governing regulator) have

implemented in the last week or so increasing constraints on

loans, in particular to investors.

Check out these articles:

Lenders Takes Notice Of APRA Property Investor Warning

Investor home loans tighten as regulator APRA clamps down

Moody’s warns on housing, Reserve Bank wants investor lending to slow more

Some of the facets are:

– increased deposit requirements of 20% (ie. max 80% LVR loans)

– lower rent considerations

– higher test interest rates (eg. 7% serviceability testing on 5% rate)

Best touch base with your banker/mortgage broker to find out where you stand,

As they say:  \”Proper Preparation Prevents Poor Performance\”

Til next time

Nhan