While New Zealand is starting to show some good results for its macroprudenmial tightening, over ‘ere it’s party like its 1999, from the SMH:
Highly leveraged new home loans are on the rise, as the property market recovery gathered pace.
New figures show banks wrote $10.8 billion in loans with a loan-to-valuation ratio of 90 per cent or more in the September quarter – 14.1 per cent of all housing loan approvals.
This was a higher share than the June quarter, when loans with an LVR of 90 per cent or higher made up 13.5 per cent of approvals.
The rise in low-deposit lending was revealed in statistics on the $1.2 trillion mortgage market, published by the Australian Prudential Regulation Authority today.
About 20 per cent of all new loans had an LVR between 80 and 90 per cent, and 40 per cent of new approvals had an LVR of 60 to 80 per cent, it said.
The rise in low-deposit lending comes amid a surge in house prices in the Sydney market in particular, as buyers competed fiercely to snap up properties.
Bang up job, APRA.
