The BIG SHIFT in Lending – What it Means for Property Investors?

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The total value of all mortgages increased by 7.3 per cent in the year to January, compared with 7.4 per cent annual growth in December.

Within this trend, however, there has been a big shift in lending towards owner-occupiers in recent months, and a sharp slowdown in lending to property investors.

According to the Reserve Bank of Australia, the value of housing investor loans grew by 0.3 per cent in the month and 7.9 per cent in the year to January. This is the slowest annual rise for this segment since February 2014.

Owner-occupier credit growth, meanwhile, has accelerated to 6.9 per cent a year, its quickest annual expansion since October 2010.

Due to pressure from the regulator, the banks are applying tougher criteria to applications for investor loans. However, it is still possible to arrange investor loans if you know which bank to approach.

Here are some examples of where applying to the right bank can make or break your investment decision:

  • A handful of banks will lend up to 95 per cent of the value of an investment property (most now only lend up to 80 per cent)
  • Three well-known lenders will take into account the benefits of negative gearing in assessing your ability to make loan repayments
  • One well-known lender will still lend 80 per cent of a property value to a SMSF
  • If you are having difficulty arranging finance, perhaps you are talking to the wrong lender. Maybe you should simply talk to Chan & Naylor Finance.





Disclaimer: This article contains general information; before you make any financial or investment decision you should seek professional advice to take into account your individual objectives, financial situation and individual needs. Click for more detail regarding this disclaimer.

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