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ANZ raises investor home loan rates

Discussion in 'Property Finance' started by turk, 23rd Jul, 2015.

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  1. turk

    turk Well-Known Member

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    turk, 23rd Jul, 2015
    #1
  2. D.T.

    D.T. Specialist Property Manager Business Member

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    D.T., 23rd Jul, 2015
    #2
  3. Terry_w

    Terry_w Well-Known Member Business Member

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    Dreadful news.
     
    Terry_w, 23rd Jul, 2015
    #3
  4. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Thanks APRA.
     
    Peter_Tersteeg, 23rd Jul, 2015
    #4
  5. channon

    channon Active Member

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    Question now is, will others follow suit.....
     
    channon, 23rd Jul, 2015
    #5
  6. Be Developer

    Be Developer Property Developer Business Member

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    is it really case of APRA or banks saying to Property investors, you are making money, give us our share????
     
    Be Developer, 23rd Jul, 2015
    #6
  7. keithj

    keithj Well-Known Member

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    The important take out from this is that it is highly likely the other 3 majors will also be raising Fixed Rates for Investors & not OOs (ANZ has raised 0.30%). If you're inclined to fix, then IMO now is the low point in the cycle for investors.
     
    keithj, 23rd Jul, 2015
    #7
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  8. Kinnon Bell

    Kinnon Bell Well-Known Member

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    APRA or thinly veiled attempt at capital raising in response to Basel III?

    Or, as I suspect, a combo of everything combing.
     
    Kinnon Bell, 23rd Jul, 2015
    #8
  9. Redom

    Redom Mortgage Broker Business Plus Member

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    APRA. Incentives.

    Incentives that might actually change behaviour.

    Don't think BaselII was about differentiation of segments of market.
     
    Redom, 23rd Jul, 2015
    #9
  10. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Several lenders already did this months ago (NAB & Macquarie immediately come to mind). ANZ's increase is significantly larger though. This now prices them so far above the competition it literally wipes them off the investor lenders panel.

    I also suspect that lenders are taking this opportunity to make some extra profits. For the last 2 years everyone has been negotiating special deals for almost every loan. The regulators have given the banks an excuse to cease this practice across the board, but without having to collude with each other on their pricing.

    My understanding is that lenders costs are fairly uniform for both owner occupied and investment loans, so there's decent profits available to lenders to charge investors extra. If they did this to owner occupiers, there'd be outrage.
     
    Last edited: 23rd Jul, 2015
    Peter_Tersteeg, 23rd Jul, 2015
    #10
  11. Terry_w

    Terry_w Well-Known Member Business Member

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    Wasn't some asking the other day if things could get worse?
     
    Terry_w, 23rd Jul, 2015
    #11
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  12. Redom

    Redom Mortgage Broker Business Plus Member

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    Yes they will.

    I called it a few weeks ago on the lending market changes post, but thought it'd happen along with interest rate changes.

    The incentives to change behaviour is definitely APRAs favourite button to push. Its also a pretty smart way to do it without creating too many spillover costs.

    The last changes were way to small to do anything. I only suspect the differences will get larger and larger over time, esp if rates are cut.

    Cheers,
    Redom
     
    Redom, 23rd Jul, 2015
    #12
  13. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I don't think anybody has actually specifically mentioned this yet, and The Age article didn't pick up on it either...

    The ANZ is raising their index rate for investment loans by 0.27% from 5.38% to 5.65%. This means that this change will effect all ANZ investment loans, not just new loans.

    Not only does it affect the interest rate of an ANZ investment loan, but it will also likely affect the affordability for any ANZ loan, if you have existing or proposed investment debt.

    It wouldn't surprise me if the other first and second tier lender follow suit. The smaller lenders are going to have a field day with this.
     
    Peter_Tersteeg, 23rd Jul, 2015
    #13
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  14. SaberX

    SaberX Well-Known Member

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    Redom - I always thought banks were ahead of the yield curve when it came to fixed rates, so any attemp to outplay them on that matter (low point or not) was pointless as they likely take into account all forseeable interest rate movements into the future to allow you to fix at those rate %'s.

    That said things do happen, but i guess it would be a gamble on something upsetting forecasts now which nobody knows. Only other reason I see is predictability of servicability repayments as not all are good with handling their money/discipline month to month?

    Or am I missing another consideration?
     
    SaberX, 23rd Jul, 2015
    #14
  15. Terry_w

    Terry_w Well-Known Member Business Member

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    ANZ appear to want people to refinance out their investment loans so that they can 'balance their books' more in favour of owner occupied.
     
    Terry_w, 23rd Jul, 2015
    #15
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  16. Redom

    Redom Mortgage Broker Business Plus Member

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    My phone has gone nuts - ah they've changed their index rate, thanks Peter. It'll be a long night!

    In terms of questions i'm getting:

    THIS IS TEMPORARY. Pricing differences are simply to cool investment lending.

    Incentive effects are temporary controls.

    LVR caps are temporary (St George, Westpac, others to follow shortly).

    Serviceability changes...permanent i think. Changes are 'fixes' to issues in prudent lending.

    Cheers,
    Redom
     
    Redom, 23rd Jul, 2015
    #16
  17. Redom

    Redom Mortgage Broker Business Plus Member

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    Doubt it. They've just moved first.

    Others will follow.
     
    Redom, 23rd Jul, 2015
    #17
  18. Tony Fleming

    Tony Fleming Well-Known Member Business Member

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    If the main banks do this I can see rents rising in response
     
    Tony Fleming, 23rd Jul, 2015
    #18
  19. 2FAST4U

    2FAST4U Well-Known Member

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    Seems like a blatant cash grab from ANZ. It wouldn't surprise me to see the other Big 4 follow suit.
     
    2FAST4U, 23rd Jul, 2015
    #19
  20. S.T

    S.T Well-Known Member

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    Might have to buy one new PPOR a year now!
     
    S.T, 23rd Jul, 2015
    #20
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