Industry weighs in on banking sector

Kevin Young, president of Property Club, said that it was outrageous that the banks would continue to pay dividends and bonuses when the Productivity Commission has stated that they are costing taxpayers $500 million each year through excessive rates on interest-only loans.

“The banks greedily decided to keep interest-only rates elevated compared to owner-occupier rates after APRA removed its restrictions on interest-only loans back in 2018-2019.

“Before APRA’s intervention in 2017, all of these interest rates were effectively the same.

“But back in 2018, the Productivity Commission reported that the restrictive interest-only policies imposed by APRA was costing taxpayers up to $500 million each year. 

The group said the banks are doing nothing to help mum and dad investors but instead will use these billions of dollars in low-interest funds from the government as a slush fund to pay dividends, outrageous bonuses to staff and take customers from smaller lenders.

“The reality is that mum and dad investors in Australia are now paying some of the highest interest-only home loans rates in the advanced economies due to the greed of the banks that has been unchecked by the government.”

“In the United Kingdom, which is now cracking down on the banks, investors can now get interest-only loans for 1.6 per cent, while they are three times that rate in Australia,” he said.

Despite paying additional mortgage rates on loans, Property Club founders Kathy and Kevin Young often feature on Queensland’s top 100 rich list, have over 200 properties, and the club boasts on its site to have 4,400 members with portfolios of over $1 million.