There’s never been a better time for Canberra investors to add to their portfolio. That’s because four years after introducing a series of lending regulations, the Australian Prudential Regulation Authority (APRA) is lifting their 10 per cent benchmark on investor loan growth.
According to APRA, the risky lending practices they were concerned with have been sufficiently managed and the measure is no longer necessary.
APRA is prepared to remove the cap
APRA has written to authorised deposit-taking institutions (ADIs) to let them know they’ll remove the benchmark for lenders who can show:
- Lending below the benchmark for at least the last six months,
- All policies are in line with APRA’s serviceability standards,
- Practices will be strengthened if needed.
If ADIs can’t offer this assurance, the 10 per cent cap will remain in place.
What the news means for Canberra investors
Many forecast that the shift will lead to greater competition in the lending sector. This is particularly good news for small players who may not have been able to compete under APRA’s tight regulation.
With more lending options available, investors who may have been hesitant will be much better positioned to snatch up their next piece of Canberra real estate. To find out more about which options might be most suitable, reach out to your Civium property manager.