Chinese Money into RE

no problem! from memory I can't remember I'm sorry but PM me if you have any specific criteria and I will ask for you!

 

No worries. Just on this, does anyone know of any online resources (perhaps like a Choice.com.au or similar?) That indexes the stability of all lenders in AU in some kind of ranked order? I am curious to learn just stable the La Trobes, Peppers, IMB's, RAMS' et al of this world really are (and how much exposure to bad debts be it non-residents, low incomes etc.) They really have. I personally have not yet entered the murkey world of tier 2/3 lenders in a very long time now (previous experience with the likes of Gateway CU and Loans.com.au / First Mac weren't that pleasant).I guess in 2017 the financial world is changing so rapidly that I find myself caring more about the financial stability of lenders for property loans than I have previously.

I might re-post the above question in the finance section to see what responses come in.

 

The way the instos think about it this would be there's lots of rules about anti-money laundering - so more effort than it's worth.

Also it just takes a few scandals to bring the bank down, and then there'll be a royal commission into it etc.

I used to work in these banks haha, they're all about risk management, not making money.

 

so true this comment

 

I used to work in a major bank Treasury. They make $ first and foremost and then when it seems thats at risk or running out of control making heaps of money they look to risk manage it without cutting off the flow. All ADIs report continually to APRA. APRA can walk in anyday and review anything they feel like or seek special information. Often banks have to be told what risks are unacceptable to the nation rather than shareholders. Banks look at self-interest but APRA looks at national interest. National interest prevails. At present toning down lending for property is a national interest no matter what anyone would like to think. But they dont want to cut it off either. Its a delicate balance.

The banks would happily lend away - Its Govt (Treasury) and APRA driving the ship. APRA means "Prudential Regulation Authority "for a reason. Its their job to safeguard the banking system from system risks for stability. They want to avoid any meltdown that takes out the economy.

 

I don't believe that's true. Banks are the most conservative beasts, in fact they are almost stupid.

They're willing to lend to properties at what is probably world-class prices, probably lose their shirt around the corner. Yet when I was working there, they won't lend to my client to buy a mine for $20m at the bottom of the market, with cashflows that was breaking even. Well that mine has in the space of 18 months benefited from a resources recover, now makes around $80m cashflow per annum. My client probably could've resold it for $500m now.

That's why I call these guys at the bank chipmunks. They just blindly follow instructions and flavour of the month, rather than think critically about how to make money. Basically they have no concept of upside, their first and foremost criteria is risk and downside. They only want sure wins, well if there was a sure win in life, the guy wouldn't be coming to you

 

you and the risk department must have gone on just swell !

 

Let's just say if any of us started our investment journey with a risk department, we'll never leave the house.

 

I like the credit guys - they keep life interesting

 

Anyone got any insight on recent auctions in suburbs like balwyn/glen waverley in Melbourne?
Been speaking to a BA and he reckons momentum has peaked out in 2015 given the additional restrictions on capital outflow / tightened bank lending standards for foreign income.

 

The cap restricting foreign investors from buying more than half the apartments in any new development is set to be reintroduced under the federal government's plan to help young Australians enter the property market.

The federal government is preparing to limit the purchasing power of offshore investors, as one of a raft of housing affordability measures to be included in the May Budget, according to weekend reports in News Limited papers.

Before 2009, developers could only sell 50 percent of new dwellings in any development to foreign buyers but at the height of the Global Financial Crisis the limit was abolished.

Treasurer Scott Morrison declined to confirm the proposed change to the foreign investment framework.

Foreign buyers already face additional stamp duty and land tax charges and continue to be limited to purchasing new or off-the-plan properties.

50 percent OTP apartment foreign buyer limit to return

 

"Foreigners buying 11pc of NSW homes"

Chinese purchased over 32 percent of those properties, followed by British and New Zealanders at 10 percent each and Indians at 6 percent.

Foreigners buying 11pc of NSW homes