For those who continue to believe the credit tightening is temporary...

Gotta love Westpac

 

Thanks Corey. So "priority to support" probably means no change for expats.

A very detailed reply, thank you Shahin.

 

This decision appears based on capital adequacy. I might guess and say that in order to remain within the 10% cap they need to shutdown the capital costly non-resident lending to enable domestic to continue.

How could this affect OTP builds in progress ?? Will Westpac just refuse their application or is there scope for this ? This could lead to a load of defaults and a surge in supply for apartments if thats the case.

 

And/or need to be seen as doing the right thing considering the spotlight being shone on some of their recent shenanigans.

 

What about the posts and general consensus on CPI thread ?

CPI Falls For First Time Since 2008

@HUGH72 Still expecting the property to double every 7-10 years ?

"The eye sees only what the mind is prepared to comprehend." - Henri Bergson.

 

Most will not have any finance together until the OTP is at completion stage - so they'll be left needing to look at alternative lenders. This space will likely become the picking grounds of 2nd tier or specialist lenders, so higher upfront and ongoing costs - but still funding available.

 

I can comprehend many things but some can be discarded as short term sentiment.

We have seen both exuberant and fearful depressed markets before.

No I posted in the Brisbane thread that with low inflation and wages growth CG will be lower than previous cycles.

I've never said property prices would double in 7-10 years.
With 4% CG prices would take approximately 18 years to double.

 

Is that lending for buying property in Australia?

 

This is for HK residents purchasing properties in Australia. HK servicing is a lot of conservative and stringent than Australian servicing standards and acceptable security is only established dwellings so they don't do construction loans.

Having said that you can do all the traditional things like equity releases, etc.

 

There's been a range of tightening of late for expats and foreign income type treatments, not just from Westpac Group. CBA have made some changes, NAB dropped LVRs, greater income haircutting associated with variability (currency risk). Some of the smaller lenders will likely get more of a look in - and will start targeting this space going forward.

In terms of policy and serviceability, expat lending has huge variations depending on the lender you go to. It often depends on where the person is located and the income that is derived. Higher LVRs CBA wins and has few competitors as Shahin mentioned. If a low LVR is ok (70%), NAB can be quite useful too particular for income sources from low tax paying countries. One of the few lenders that will use net income (converted of course).

 

Very prudent by Westpac...they know there is a lot of ...lets say gilding of the lily going on with foreign buyers.

They are a bank...watch what happens with whether loosen up on IP lending....