Investment Loan Rate Increased? Investment Loan Review

The post Investment Loan Review appeared first on Oak Laurel.

Has your investment loan interest rate increased? Don’t be ripped off, get an investment loan review

If your investment loan rate has recently increased or it has been a while since you had it reviewed you may want to get an investment loan review to check if there are any better options available.

What is going on with investment loans?

If you have been ignoring the chatter in the media about property prices and investment lending you may not be aware that the Government Banking Regulator (Australian Prudential Regulatory Authority or APRA) has been putting pressure on the banks to curb their investment lending if they have their investment loan books growth above 10%.
The offending banks and even some banks that were not above APRA’s 10% investment loan growth limit have responded in a number of ways:

1. Raising their investment loan interest rates including for existing variable rate investor loans;
2. Changing their borrowing power calculations to make it harder for property investors to qualify for a loan;
3. Limiting investment loan to value ratios to lower levels; and
4. Decreasing their interest rates for owner occupied loans to encourage more owner occupier borrowers and even out their loan books.

Not all offending banks are doing all of the above.

Are there still good investment loan interest rates available?

Yes,there are still good investment loan interest rates available! Not all lenders have exceeded APRA’s 10% investment loan growth limit and some lenders are still actively competing to get your investment loan. These other lenders are still offering competitive investment property interest rate, fee and feature packages.
As property investors we know how important it is to have a competitive interest rate on your investment loan. If you are paying more interest than the rental income, negative gearing may make up some of the difference but even with negative gearing you are still paying money out of your own pocket. This can impact on your ability to make further investments and or your lifestyle. Lets face it no one want to pay more than they need to on their loan, least of all property investors who are investing to make money.

Are higher loan to value ratio investment loans still available?

Yes, higher loan to value ratio investment loans are still available! Some lenders are also still offering higher loan to value ratio loans 90% or up to 95% LVR exclusive of lenders mortgage insurance for investment properties.

Find out more about higher LVR investment loans

With the recent lending changes some banks have stopped offering higher loan to value ratio loans for property investors. Other lenders are still happy to lend at higher LVRs up to 90% or 95%.

High LVR investment loans

Investment loan review – Free

If your investment loan rate recently went up then you should get your investment loans reviewed by one of our finance professionals that understand investment loans. Oak Laurel has mortgage brokers that know which lenders have the good investment loan rates now. Or brokers can assist you to switch your investment loan portfolio to where there is a better loan package from another lender. If you have one investment property or many investment properties, our investment loans specialists will review your loan portfolio to identify if they can get you a better loan or loans. If you also have an owner occupied home loan(s) our finance professionals can check to see if there is something better available for that also.
We will not charge you for the review. If we cannot find any better options then there is no loss to you. However, you can be confident that you are not being ripped off. If we can find you better options then it could save you a lot of money.

Contact an Oak Laurel about an investment loan review!

Don’t delay act NOW!

+614 30129662

Oak Laurel – Investment property loans made easy!

The post Investment Loan Rate appeared first on Oak Laurel.


from Oak Laurel | RSS Feed http://ift.tt/1Eh32XN

Is Melbourne overtaking Sydney as the hottest property market? Aug 2015

The post Is Melbourne overtaking Sydney as the hottest property market? Aug 2015 appeared first on Oak Laurel.

Property price growth data shows that in the last Quarter, Melbourne property has out paced Sydney’s to become Australia’s hottest property market as at Aug 2015

Property price growth in Melbourne and Sydney

Latest property price data from PRData shows that in the last quarter Melbourne property price grew 7.85% out pacing Sydney price growth at 6.66%. Month on month price data also shows a similar trend, Melbourne price growth outpacing Sydney’s, overall and for houses. Though Sydney’s unit prices grew faster than Melbourne the difference was only 0.06% between the two or in practical terms they were the same.
In recent years Melbourne has shown some reasonable price growth but until the last quarter have been outpacing Melbourne’s by a large amount. With Sydney’s property prices now so high many believe that they are unaffordable. There have also been reports that property investors looking to buy in Sydney have been turned off by the high prices and are now turning to Melbourne where prices have been rising at steady pace. Now that Melbourne’s price growth appears to have overtaken Sydney’s investors chasing capital gains may also be more attracted to Melbourne.
Melbourne property has not had the attention from property investors that Sydney has had with a larger proportion of owner occupiers. However, if investors now find Sydney too expensive or decide to target Melbourne which has in the last quarter become the hottest property market, this may be the start of a flood of investors to Melbourne property.

Auction clearance rates in Melbourne and Sydney

Recent auction clearance rates show a similar trend to the property price growth in Melbourne and Sydney. Over previous five weeks Melbourne’s auction clearance rates have shown a steady building increase from 74% five week ago to 75%, 76% , 77% to 80%.  Sydney’s auction clearance rate though having 80% last week have showed a decreasing rate previously from 78% five weeks ago to 76%, 76%, 73% before last weeks jump back to 80%.

Is Melbourne a good place to invest in property?

Invest where people want to live, especially where people who have wealth want to live as this is the demand side of what drives up property prices. People want to live in Melbourne. Melbourne has been named the world’s most liveable city for the fifth year in a row, achieving a near perfect score on the Economist Intelligence Unit’s (EIU) liveability survey of 140 cities. Each year thousands more people move from NSW, mostly Sydney to Victoria, mostly Melbourne than go the other way. Melbourne has the greatest number of people immigrating to it than any other Australian city. The ABS forecasts that given current levels of migration and fertility rates, Melbourne will overtake Sydney as Australia’s biggest city by 2053.
It is not all Melbourne’s way though. Vacancy rates in Melbourne at 2.3% are however, slightly above that in Sydney at 1.8% as of July 2015, according to SQM research data. However, both cities have lower than the national average vacancy rate at 2.4%.
Latest data also shows that rental yields are also slightly lower in Melbourne than in Sydney.

Conclusion

This data does not mean that Sydney’s property prices will not continue to grow, there is every indication that the it will continue to grow into the future. The data does suggest that Melbourne is now the hottest property market and may catch up to Sydney over the coming years.
Only time will tell if Melbourne will continue to be Australia’s hottest property market!

Want to talk to one of our Melbourne based mortgage brokers?

We have mortgage brokers around Australia. Do you want to talk to one of our mortgage brokers in Melbourne? Click here:

Melbourne based mortgage brokers

Want to talk to one of our mortgage brokers in Sydney?

Contact our Sydney based mortgage brokers to discuss your mortgage needs whether it is for an owner occupied property or investment property. Click here:

Sydney based mortgage brokers

Oak Laurel Mortgage Brokers – Home loans made easy!

The post Is Melbourne overtaking Sydney as the hottest property market? Aug 2015 appeared first on Oak Laurel.


from Oak Laurel | RSS Feed http://ift.tt/1UWLdBz

New investment property loan rules: who are the losers

The post New investment property loan rules: who are the losers appeared first on Oak Laurel.

First home buyers buying an investment property will be big losers from bank policy changes

First home buyers buying an investment property for the benefits of rental income and negative gearing will be big losers from the new lending requirements

Why would first home buyers buy an investment property?

With prices already high in Sydney, which first home buyer can afford to purchase an owner occupied home to live in? Super rich? People who want to spend most of their income repaying their mortgage? As a first home buyer, regardless of if you are buying in Sydney or another place, it can make sense to buy a first home as an investment property. The rent helps to make the mortgage payments and negative gearing helps out at the start when there is a shortfall between the rent and the mortgage interest.

What makes it harder for FHB to borrow for an Investment property now?

With lending policies making it harder to get higher loan to value ratio loans for investment properties, now first home buyers buying an investment property must somehow find additional savings to put towards the deposit. However, in rising markets like Sydney and Melbourne, property prices are rising faster than many first home buyers can save for the deposit especially when a larger deposit is required.

So what is the answer for first home buyers taking out an investment property loan?

If the first home buyer has family that want to help and the family member has equity in their property a guarantor home loan may be a good option.
Find out about Guarantor home loans here:
Guarantor home loan

Others can still access higher loan to value ratio loans for investment properties.

Don’t have family that can help you out? Maybe you are not even a first home buyer?
Some lenders are still lending at higher loan to value ratios for investment property loans. The many banks may have cowered to the pressure of the APRA but other non-bank lenders are not regulated by APRA and are operating as usual for investors.
It will be these non-bank lenders that will benefit from APRA’s crackdown as investors seek new ways to invest with leverage.
Need a hand to sort through the maze of lenders and their ever complicated lending policies?
Oak Laurel has mortgage brokers many of Australia’s major cities (Sydney, Melbourne, Brisbane, Adelaide, Perth and more). Contact an Oak Laurel mortgage broker near you to find out what your borrowing options are in the new lending environment.
Mortgage broker in Adelaide

Mortgage broker in Brisbane

Mortgage broker in Melbourne

Mortgage broker in Perth

Mortgage broker in Sydney

Will these new bank rules stop price rises in the housing market?

No, this is not the prick that bursts a bubble. There is still plenty of demand for property in Australia both from locals and foreign investors. Property investors borrowing to buy property may get a little spooked when they walk into their local bank branch and get told ‘no’. However, smart investors will go to a good mortgage broker, like Oak Laurel, and find out that there are still lending options available.
The rules are not designed to stop gains in the property market. In fact they are in effect designed to keep the property market going strong. The measures are designed to ensure that major banks are not too heavily secured by investor loans. It will really give the non-bank lenders who are not regulated by APRA a selling point and introduce a bit more competition into the investment property loan market and home loan market more generally.

Oak Laurel Mortgage Brokers – Home loans made easy!

The post New investment property loan rules: who are the losers appeared first on Oak Laurel.


from Oak Laurel | RSS Feed http://ift.tt/1NTJ0Te

Banks reducing borrowing capacity of property investor customers May 2015

The post Banks reducing borrowing capacity of property investor customers May 2015 appeared first on Oak Laurel.

Banks are now reducing borrowing capacity of property investors, May 2015

Recent changes in loan assessment policies by several banks has reduced clients maximum borrowing capacity. This has been done by making their loan assessment criteria tougher when assessing customers ability to repay loans.
This is especially true for borrowing for investment properties or when using income from investment properties in calculations on the client’s ability to repay loans. Other changes include removing negative gearing allowances, limiting loan to value ratios to 80% for investment loans and removing discretionary interest rate discounts for investment loans. With different banks choosing different measures (out of those listed above) to make their borrowing power more conservative.

Why are the banks changing their policies to reduce borrowing capacity, particularly for property investors?

These recent changes are in response to the pressure that the Australian Prudential Regulation Authority (APRA)  has been asserting on banks and lenders in response to the growth in particularly investment property loans for speculative real estate purchases (i.e. Sydney).
These new changes come after APRA warned banks about the importance of vigilant credit assessments, after the outcomes of a hypothetical borrower survey were “a little disconcerting in places”. When using the assessments used by lenders when determining how much people could borrow under different hypothetical borrower scenarios, APRA found large differences in the maximum borrowing capacity between lenders. With the largest assessed maximum borrowing amount from a lender being in the order of 50% more than the most conservative lender. ARPA stated that one significant factor behind differences in borrowing capacity, particularly for owner occupiers, was how lenders measured the borrower’s living expenses.  Another area of interest were the differences in the treatment of interest only loans in the hypothetical test, which included one borrower seeking a 30-year loan, with the first 5 years on an interest-only basis.
These blanket measures for property investors appear to be rather un-targeted given that the concern of an overvalued property market is restricted to Sydney and the new tighter measures apply regardless where the property is being purchased.
Limiting lending in certain postcodes is a target approach that has been used by lenders to limit bank exposure. It is unclear why lenders have not taken a more targeted approach of limiting lending or applying tighter lending measures by postcode now.

Are you still interested in borrowing to invest in Australia’s property market?

Some lenders still provide reasonable borrowing capacity for property investors. Find out more about investment property loans here:
Investment property loans

Or contact a mortgage brokers near you to go through your finance options:
Mortgage brokers in Adelaide

Mortgage brokers in Brisbane

Mortgage brokers in Canberra

Mortgage brokers in Melbourne

Mortgage brokers in Perth

Mortgage brokers in Sydney

Mortgage brokers in other areas

Oak Laurel Mortgage Brokers – Home loans made easy!

The post Banks reducing borrowing capacity of property investor customers May 2015 appeared first on Oak Laurel.


from Oak Laurel | RSS Feed http://ift.tt/1EUVsfa

Two of Australia’s big four bank stop offering self Managed Super Fund property loans

The post Two of Australia’s big four bank stop offering self Managed Super Fund property loans appeared first on Oak Laurel.

NAB joins ANZ in ceasing offering Self Managed Super Fund property loans

Among concerns of an overheated Sydney property market National Australia Bank (NAB) has confirmed it will cease offering Self Managed Super Fund property loans.

NAB is now the second major bank cease offering SMSF property loans following ANZ  that announced that it supports for the Financial System Inquiry’s recommendation to remove the exception to the general prohibition on direct borrowing for limited recourse borrowing arrangements (LRBAs) made by superannuation funds. This latest move by the National Australia Bank comes after the recent cut to the Cash Rate by the Reserve Bank of Australia.

The recent cash rate has cause concern amongst some as they fear that it will lead to a further stimulation and ultimate burst of the “Sydney property bubble”. The recent NAB decision to cease offering SMSF property loans has only lead to further speculation about Sydney’s property bubble.

Are you looking to purchase property in your SMSF?

If you are wanting to invest in property through your Self Managed Super Funds (SMSFs) do not despair some lenders still offer SMSF loans for property.

You may be able to use a SMSF property loan to purchase a single residential investment property if you are an Australian resident with an existing SMSF or are in the process of establishing an SMSF you may be able to also purchase a commercial property in your SMSF.

Contact us about a Self Managed Super Fund property loan.

SMSF property loans

Do you want to invest in Australian property?

Find out more information about investment property loans.
Investment property loans
Or if you want to discuss your home loan, investment property loan, or business loan options with a mortgage broker contact us:
Mortgage brokers in Adelaide

Mortgage brokers in Brisbane

Mortgage brokers in Canberra

Mortgage brokers in Melbourne

Mortgage brokers in Perth

Mortgage brokers in Sydney

Mortgage brokers in other areas

Oak Laurel Mortgage Brokers – Home loans made easy!

The post Two of Australia’s big four bank stop offering self Managed Super Fund property loans appeared first on Oak Laurel.


from Oak Laurel | RSS Feed http://ift.tt/1dSweIL