Recent changes to investor lending may be having the positive impact of preventing risky investors from entering the market, a leading property commentator has claimed.
The APRA lending crackdown is preventing ‘marginal’ property investors from entering the market, according to CoreLogic RP Data senior research analyst, Cameron Kusher.
“It means those marginal people coming into the investment space that possibly shouldn't be in a position to invest in property in the first place are now not going to be able to do so and, from a financial stability point of view, that’s a good thing,” Mr Kusher told Smart Property Investment’s sister title, Mortgage Business.
According to Mr Kusher, new residential developments in Sydney, Melbourne and, to a lesser extent, Brisbane are set to be most affected by the changes.
Despite this, he remains dubious over the overall impact of the changes on investor lending growth, claiming that it has been “somewhat overstated”.
He cites the latest credit growth figures from the Reserve Bank of Australia as evidence of the limited impact the tightened lending guidelines have had.
“If you look at housing credit growth for investors, it got up to about 11.1 per cent on an annual basis,” he said. “It has now come down to 10.7 per cent.”
As Australian lenders continue to target owner-occupiers with discounted home loan rates, the impact of having to tighten investor credit becomes diluted, Mr Kusher said. “Overall, I don’t think it’s going to have a huge impact,” he added.