Join Australia's most dynamic and respected property investment community

All aboard the rate rise train - Macquarie Bank 0.27%

Discussion in 'Property Finance' started by Corey Batt, 24th Jul, 2015.

  1. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,167
    Location:
    Adelaide, SA
    It's the magic number.

    "
    In response to market conditions, including investor lending restrictions, we are making the following pricing changes:

    · fixed and variable rates for new investment home loans to increase by 0.27% pa, effective Friday 31 July 2015

    · variable rates for existing investment home loans to increase by 0.27% pa, effective Monday 10 August 2015.
    "
     
    D.T. likes this.
  2. jaybean

    jaybean Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    981
    Location:
    Melbourne
    And when there's another rate cut, watch them double dip with the same excuse. Watch them triple dip. They're going to go George Costanza on our asses.
     
  3. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,099
    Location:
    Melbourne, Nationwide
    Son of a b***h!

    I had lunch today with the state manager from Macquarie, no mention was made of this.

    I'm thinking the best way to deal with this is rather than panic refinancing, people would be best served to wait a few more weeks (months?) for the dust to settle. No easy answers here.
     
  4. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,167
    Location:
    Adelaide, SA
    Had the same thing happen to me with ANZ on Thursday - he clearly didn't know the change was coming as he was jabbering on how their rates weren't *too* bad for investors.

    Bzzt.
     
  5. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,145
    Location:
    Canberra and Sydney
    Lol - wait until CoB Friday to broadcast the bad news.

    ANZ's PR team needs to learn from this. They always seem to be the first to deliver bad news - then the rest follow.

    Cheers

    Jamie
     
  6. magpieseason

    magpieseason Active Member

    Joined:
    6th Jul, 2015
    Posts:
    37
    Location:
    sydney
    Hi can someone advise.

    Is a topup loan against an ip (funds used as deposit to buy ppor ) considered an investor loan?
     
    Last edited: 25th Jul, 2015
  7. sandyfeet

    sandyfeet Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    130
    Location:
    South Coast NSW
    Interesting times ahead,
     
  8. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,161
    Location:
    Gold Coast
    AS Redom has suggested, this is likely the hush hush of capital cost increase for IP backed loans.

    The adjustment bureau is back :)

    ta
    rolf
     
  9. TaylorChang

    TaylorChang Well-Known Member

    Joined:
    2nd Jul, 2015
    Posts:
    167
    Location:
    Sydney
    I feel hurt for the first home buyer already ... ><

    All the cost of funding will be passing down from big banks to big investors and flow to small investors then ultimately vulnerable first home buyers and renters.
     
  10. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,167
    Location:
    Adelaide, SA
    Except those First Home Buyers are now getting access to some of the cheapest rates in Australian history - especially thanks to APRA.

    Even first time investors - outside of LVR squeeze aren't getting hit too hard, it's primarily those with an established portfolio who are needing to restructure and strategise how to they progress under the new regime.
     
  11. TaylorChang

    TaylorChang Well-Known Member

    Joined:
    2nd Jul, 2015
    Posts:
    167
    Location:
    Sydney
    Totally agree Corey :)
    Those highly geared investors and FHB with very small deposit are the one getting pinch.

    With hot Sydney market, I have some inquiries from people with very little deposit wanted to buy first home.... feel the pain for them. :confused:
     
  12. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    2,458
    Location:
    Sydney & Gold Coast
    Choo! Choo!
     
  13. Redwing

    Redwing Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    838
    Location:
    WA
    And if next month the RBA drop rates again?
     
  14. jaybean

    jaybean Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    981
    Location:
    Melbourne
    As I said, they'll double dip with the same excuse. Costanza style.
     
  15. Propagate

    Propagate Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    282
    Location:
    Melbourne
    What constitutes "Investment Home Loan" with MacQ? Our PPOR mortgage is with them, it's called "Offset Home Loan" on the online banking. It has a few splits for deposists on 2 IP's plus our main PPOR loan. Tgeplsits are all secured against the PPOR but were used for the IP deposits. Does the whole loan count as a home loan, rather than investment loan in this case?
     
  16. chylld

    chylld Well-Known Member

    Joined:
    25th Jun, 2015
    Posts:
    595
    Location:
    Sydney
    I would guess yes, a loan secured by an IP (regardless of the purpose) is in the firing line, as it is part of the risk equation that APRA is targeting

    edit: and obviously, the interest won't be tax-deductible as the purpose is not income-producing
     
  17. euro73

    euro73 Well-Known Member Business Member

    Joined:
    18th Jun, 2015
    Posts:
    1,430
    Location:
    Sydney
    Hearing that Macquarie will need to make some very big additional adjustments in the coming weeks, over and above the changes already announced. APRA has told them they haven't gone close to doing enough yet.

    On the subject of AMP - I am told they will be completely withdrawing from accepting INV properties as security immediately - expect an announcement this afternoon or tomorrow.
    I'm led to believe all existing variable debt will be going up @ 45bpts and all pre approvals will be going up @ 100 bpts . They will be exiting SMSF lending as well, I am told. Loans secured by O/Occ security will be seeing aggressive reductions - very low 4%'s Im told.

    I'm also hearing CBA and Westpac have been told they havent done enough and need to do significantly more...

    This next 7-10 days might be the biggest shift in the lending landscape in decades.
     
    RetireRich101 likes this.
  18. Doraemon

    Doraemon Active Member

    Joined:
    24th Jul, 2015
    Posts:
    33
    Location:
    Australia
    So is sit and wait the best thing to do for now? Wait until this shift in interests rates settles before deciding what to do next?
     
  19. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,099
    Location:
    Melbourne, Nationwide
    I'm thinking that all the adjustments to investment policy isn't going to have any real effects. The real outcomes of all this will be the smaller lenders will capture a larger market share, but investors will still want to borrow money. These rate rises are only bringing rates for investors back to what they were in January this year and the market was still hot then. A couple of interesting things I read in this mornings paper:

    * Glenn Stevens (RBA Chairman) has indicated that they're not anticipating any further rate drops.
    * He's also mentioned that investment loan rate rises is exactly what he's been wanting the banks to do.

    To really slow the investment market, a few things probably need to happen:
    * The RBA needs to increase rates (not just investors, but scare everyone!).
    * The government needs to get very tight on foreign investment.
     
    RetireRich101 and MJS1034 like this.
  20. euro73

    euro73 Well-Known Member Business Member

    Joined:
    18th Jun, 2015
    Posts:
    1,430
    Location:
    Sydney
    You're correct that it only brings rates back to earlier levels, but the wider impact is that it doesn't bring borrowing capacity back to January levels, it brings it back to post GFC levels. ( in the case of Westpac, perhaps prehistoric levels :) ) And lets be cautious about just how much business can migrate from the majors to the smaller lenders and non banks . They already wouldnt write a lot of what the majors would, pre APRA. They arent likely to get any significantly more generous now. But yes, they will absorb some business- no doubt. This is why these changes wont lead to a collapse, but rather a slow down.
     
    RetireRich101 likes this.