Banking regulator moves to slow the flow of housing finance
Australia’s banking watchdog has moved to restrict the flow of finance into the property sector, telling banks to increase the minimum interest rate buffer used to assess the serviceability of home loan applications.
Many Australians will see their borrowing capacity significantly reduced from the end of this month under changes announced by APRA this week. Photo: Shutterstock (Image source: Shutterstock.com)
Australia’s banking watchdog has moved to restrict the flow of finance into the property sector, telling banks to increase the minimum interest rate buffer used to assess the serviceability of home loan applications.
The Australian Prudential Regulation Authority wrote to all authorised lenders this week telling them to assess new borrowers' ability to meet loan repayments at an interest rate of at least 3 per cent above the rate offered.
Banks…
