Since October 2014 The Australian Prudential Regulatory Authority (APRA) has made it clear that they want to see a reduction in the rate of lending growth for investment purposes.
In December 2014, APRA announced its plans to cap investment lending growth at 10% for all lenders. We have now seen the first raft of changes being bought into affect by lenders in the areas of policy and pricing in an endeavor limit lending growth to investors. Some of the changes have been as follows;
CBA, ANZ, Westpac, Bankwest have removed discretionary pricing on investor loans.
Westpac and AMP have made changes to their serviceability rules on negative gearing, rental and other investment income.
St George, Citibank, Advantedge and Suncorp have either introduced or increased their floor rates for assessment,
Bankwest has introduced LVR restrictions on investment loans.
In addition to the above, all lenders appear to be introducing policy to load all existing debt, no matter which lender that debt sits with. This will have a significant impact on borrowing capacity.
My expectation is that we will continue to see changes in policy and pricing across the board.