Credit drying up
It's interesting to consider that Labor's negative gearing policy was announced to help homebuyers compete with investors.
Alas for the timing, for there won't be any investors left to compete with the way things are going, with another sharp decline in the flow of new loans in September 2018!
Alas for the timing, for there won't be any investors left to compete with the way things are going, with another sharp decline in the flow of new loans in September 2018!
That's the flow; the stock of investment loans is now 33½ per cent of total housing loans by value, which is a lower share than 14 years earlier (and now becoming surprisingly low given the casualisation of the workforce, higher stamp duty hurdle, and higher rates of immigration).
The troubling news is that the forensic analysis of everything from pet food store to personal trainer expenditure on mortgage applications is making life tough for homebuyers too.
I'm no alarmist but another 4 per cent drop in the value of lending in September 2018 - and even more for owner-occupiers - is an ugly result, and now unquestionably adding to financial stability risks, rather than reducing them.
