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THE PROPERTY NERDS: Rate rise wipes $50k off borrowing power – how investors are fighting back
As higher interest rates squeeze borrowing power, non-major lenders are becoming more competitive than ever. Arjun Paliwal and Jack Fouracre explain why lending policies matter more than rates and the strategies investors can use to stay ahead.
On this episode of The Property Nerds podcast, InvestorKit’s Arjun Paliwal and Fouracre Financial’s Jack Fouracre unpack what the latest rate rise means for investors: from repayments to borrowing capacity, and why the action is shifting to third-tier and non-bank lenders.
Fouracre says that while borrowing power has reduced by 2 to 3 per cent, falling investor lending has sparked a price war among non-major banks. The pair explain why the right policy, such as longer loan terms and extended interest-only periods, can unlock more lending than a sharper rate.
They also examine whether pre-approvals can protect investors against further rate rises, with some lenders offering six-month approvals and locking in assessment rates even if interest rates increase.
Finally, Paliwal reveals why the coming months could present a buying opportunity for investors, as softer property prices lift rental yields, fewer buyers attend open homes, and increased listings give purchasers greater negotiating power.
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