Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Saturday, 11 June 2016

Lending finance eases

Lending finance eases

Total Lending Finance eased back a little in the month of April, and sits below recent highs in trend terms. 



Commercial finance has come unstuck a little lately, while APRA's tightened serviceability criteria have slowed lending to both property investors and owner-occupiers, at least temporarily.


Industry

At the industry level, it seems that low interest rates have helped the respective economies of Melbourne and Sydney - with business borrowing rates now confirmed as being at their lowest ever level - but elsewhere not so much.


Commercial lending to the mining sector has been obliterated, down by more than half in rolling annual terms in the last year alone.


Other industries are not faring too badly.

Property investor loans

APRA's crackdown has continued to slow property investor lending across the board.


Meanwhile in the Northern Territory, the property investment outlook is grim.


The wrap

A short and snappy post today.

APRA's macroprudential measures and their impact appear to be following a very similar trajectory to what played out in Britain during and after its Mortgage Market Review (MMR).

The initial measures ran interference with the market and knocked back prices and activity for a period of time, before the market reasserted itself and experienced a second wind.

Only some time later has Britain's housing market reached its apparent peak, and eventually it was changes to tax policy (and a confidence sapping referendum) which will be recognised as having brought the up-cycle to a close.

Australia could be treading a similar path. 

On Monday, the Commonwealth Bank of Australia will announce that it has slashed mortgage rates on a number of its products, with mortgage rates increasingly set to be available below 4 per cent from a number of lenders.