Changes / tightening on servicing for investors

So far we have had the following:

* Westpac group - Max 70% LVR for non residents.
* Westpac group - Increase their buffer on all new and existing Westpac loans.
* Macquarie - reduction in servicing for capacity for IO loans.
* AMP - no more taking other banks debts at actual repayments. This is a big one.
* AMP - no more 100% of rental income taken but now will use negative gearing.

Any others?
 
I believe Macquarie's servicing calculator no longer refreshes after 6 months. Their cash out policy was tightened a while back too (5% of security value above 80%).

This is reasonably big too, but not very unexpected.

Good thread Marty. :)

Cheers,
Redom
 
One of the biggest CG properties I have is with Bankwest...I hope they stay put for a little bit longer. I can't draw more equity until the next FY.
 
I think we're only seeing the start of it. I think it's about to get very tough for investors in the near future, there's more policy change rumours around that are looking very nasty.
 
Looks like we are all going to have to turn into property developers.
Buy 1 house, build 3, sell, rinse and repeat.
 
Since they can't regulate the property markets via interest rates, as they have to reduce due to more macro level stuff going on, I think we'll see it regulated via tightness in lending.

Wouldn't be surprised if LMI gets the boot or at least gets much harder to play with.
 
Wouldn't be surprised if LMI gets the boot or at least gets much harder to play with.
This would surprise me.

We don't have a high LVR problem with the proportion of 90%+ loans relatively low.

In the regulators eyes, we have a problem with a disproportionately high level of investor activity, likely to be fuelled by exuberance, and the non amortisation of loans.

What they're doing seems to target the two problems - assessing I/O loans at higher benchmarks or charging higher prices, AND, tightening serviceability calculators for people who own multiple properties.

Cheers,
Redom
 
reminds me of 2009 -2010
Anyone recall what happened in 2002-04 with regards to lending market policy? Pretty sure it was an investor boom with very fast price growth.

I believe the regulators have talked about their experience in cooling a boom, citing this period.

It was coupled with a few rate rises so that would've done the trick, but apparently the precursor was lending policy tightening. Pretty hard to get a gauge for this by looking at public information though.
 
Hi guys
1.With westpac tightening their buffer, r they on par with anz now in terms of servicibility
2. With i/o loans with macquarie what did they do to tighten servicibility
Thanks in advance
 
reminds me of 2009 -2010
Fun times!

Half the industry quit in frustration. Lenders eventually realised they'd over compensated, they adjusted back and those left standing have never been busier.

Seriously, all this is going to be very tough for investors, but it's going to be a great opportunity for those who can take advantage of it.
 
Anyone recall what happened in 2002-04 with regards to lending market policy? Pretty sure it was an investor boom with very fast price growth.

I believe the regulators have talked about their experience in cooling a boom, citing this period.

It was coupled with a few rate rises so that would've done the trick, but apparently the precursor was lending policy tightening. Pretty hard to get a gauge for this by looking at public information though.
I started in 2003 but can't really comment on bank policy changes at the time because it was all so new to me and I had no historical context. What I do remember was the NSW vendor duty tax was a major contributing factor to cooling things down in Sydney (I was in Canberra) along with rate rises in November and December 2003.
 
More importantly I'm wondering what this will do to the property market in the next 12 months and beyond - both in terms of growth and rents. Here's my (probably worthless) forecast :

- CG rates across the country with the exception of Perth and Darwin will remain positive (between 1-7%) given record low interest rates and
- (HOPEFULLY) rents will start to rise starting later this year up to 10% over the next 2 years)
 
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