These changes are in response to the breakaway property markets in Melbourne and Sydney where home prices have increased by 16% and 19% respectively for the last 12 months.
One contributing factor to these increases is the abnormally high number of investors buying properties in these locations.
The banking regulators (including ASIC and APRA) are encouraging banks to make investment lending less attractive by restricting the growth of investment loans.
As a consequence, investment loans for both new and existing investors have seen increasing interest rates and there could still be more to come.
At a time of uncertainty on future directions on investment loans, it makes send to keep a close eye on how your lender is reacting to these changes, and consider how this will impact you. And where possible, negotiate a better deal with your existing bank or an alternative lender.
For advice on investment loans or any other lending needs, feel free to contact one of our consultants today on 1300 308 225