Can APRA slow the Victoria juggernaught?

With a booming population, jobs, infrastructure spending as well as decreasing vacancy rates, can APRA and the banks slow the Victorian property market?
Future (at least short term) looks bright according to the measures and indicators covered in below article from St George / Bank of Melbourne.
With an expected further spike in prices from July 1 with increased FHO grants/stamp discounts will the boom continue?

 

I wonder the same thing .. as we all look back to the last time similar policy was implemented and saw a boost to prices ..

however the other thing that the report highlights is just how low the % of sales are to FHO/owner-occupiers.. is the thinking that FHO will at least try to further outbid investors, inflating prices? or that they will outbid each other inflating prices?(they seem like such a small % of the buying market, so can't seem to connect the 'increase' many people may be expecting - but i may be missing something here!)

I just struggle to see what impact FHO will have, especially as it's only for <600k then a scale to <750k.. perhaps the rise will be in units which haven't seen anywhere near the same levels of growth

 

Restrictions on lending usually mean less buying, those with cash can ignore, but they would be minority.

 

Apron changes just means slowdown in credit growth and not reversal.

Total value of loans will still increase 10% a year as allowed by APRA. So since credit is only growing at 10% a year, by extension, property prices would probably be limited at growing 10% a year going forward, as most property purchases will be funded by this growth in credit.

Property prices could rise more than 10% if there was significant additional credit or cash input from overseas though.

IMHO it will take something big like a financial crisis from overseas or big rise in interest rates to affect credit provision in a big enough way and to flip sentiment the other way.

 

Could drive up prices in established middle to outer ring. Also new H&L estates.
Those selling these mid to outer ring to upgrade then have extra $ (equity realised) to move closer in (if they wish). Hence the ripple effect actually moves from outside to closer in when the relatively lower priced areas are being inflated.
Also could push up unit prices as you mention.

 

Good point. Thing is, Melbourne has always had a mind of its own - I know that sounds illogical, but let's remember that the last boom was going off just after the GFC.
My current unqualified thinking is that FHBs won't be massively put off by Apron or banking downgrades as all they're doing is borrowing someone else's money and then coming to terms with paying off a mortgage and eating avocado at the same time. On th e other hand, I suspect that a lot of investors who haven't already pulled back will start to do so.
Seems to me the conditions are good for FHBs and not as good for investors. Time to decide whether to offload or hold on. But I don't think the growth is over yet, especially for under 600Kish up to 750Kish. Then again, what would I know?

 

Hard to tell what will happen. FHB already get stamp duty discount 50% I believe? So on 500k their stamp duty is $12.5k

 

Wow. VIC has overtaken QLD as the second favourite destination of tourists to Australia.

Also, from the report:

"Growth in the number of owner-occupier home loans approved in Victoria has slowed from a double-digit pace in early 2016 to be down 1.5% in the year to March 2017. The value of investor loans (which has made up around 37% of the value of all loans) recovered from weakness early in 2016, to grow by 3.6% in the year to February 2017. "