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Australian Lenders Are Clamping Down on Foreign Buying of Homes

Discussion in 'Property Market Economics' started by Kangabanga, 27th Apr, 2016.

  1. Kangabanga

    Kangabanga Well-Known Member

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  2. Tony3008

    Tony3008 Well-Known Member

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    Could be very nasty when all the currently under construction towers in Melbourne get to settlement time and buyers need to borrow billions of dollars but can't.
     
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  3. larrylarry

    larrylarry Well-Known Member

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    I'm sure some on the sidelines may be happy about this...and maybe developer will rethink their pricing.
     
  4. samiam

    samiam Well-Known Member

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    it won't affect much for cash loaded foreign buyers
     
  5. barnes

    barnes Well-Known Member

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    It won't, other factors will. China is going down - hard, also they are tightening abilities to move cash out of the country. Other foreign buyers are not really interested in Australian property. It's cheaper to buy almost everywhere else in the world.
     
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  6. See Change

    See Change Timing Lord Premium Member

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    And the property markets going to crash big time , isn't it Barnsy ....:rolleyes:

    Cliff
     
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  7. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Cash loaded buyers are looking at preserving their wealth. They will evaluate the wealth destination as well. Some other factors which might effect their decision:
    • Devaluation of destination country's currency.
    • Reduction in asset (property) value.
    • Destination country's economy. Deflation does not bode too well.
    • Transaction costs. Already jacked up by Victoria.
    • Regulatory hurdles. FIRB and ATO are different beasts now than they were 18 months back.
     
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  8. Kangabanga

    Kangabanga Well-Known Member

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    if foreign buyers were that cash loaded why would the banks offer resi loans to them in the first place?

    and if their loan books are not significant why reduce the lending to 70% last year and now completely shut off all credit? just when sydney/melb markets are turning down??

    Seems like last year's reduction of foreigner LMR was in response to APRA and this year's closure of loans are a reaction to the falling markets and possible fallout coming soon.

    IMHO I think many Chinese/Overseas buyers of apartments do get loans. I know a few overseas buyers with those loans. Even for houses, an agent told me last year she had a buyer(a local permanenet resident) who had already bought a couple houses from her, but was unable to obtain further funding from Westpac, as his income was from overseas.

    Those really cashed up overseas buyers will usually be buying higher value >$1.5m houses not on loans so it wont affect them much. But the OTP apartment market is also pretty massive in Syd/Melb and I bet there's a lot of bank lending to foreigners going into these markets.

    Anyone have any numbers on how much our banks have on loan books to foreign buyers at the moment???
     
  9. Tony3008

    Tony3008 Well-Known Member

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    My first two Australian properties, bought when I was living in UK and didn't know better, were Central Equity Melbourne CBD apartments, bought 2000 and 2002. At that time CE ran four or five sales campaigns a year in London and their team included a CBA manager, ready to sign people for finance down the line.
     
  10. Waterboy

    Waterboy Well-Known Member

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    Would like to buy some at superbargain prices when the time comes. :D
     
  11. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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