As we head into further RBA rate cuts, today or in the next few months and then again next year, macroprudential measures are going to take centre stage first to control the narrowing number of housing markets in blowoff and then later to provide further easing.
MB has noted how useless has been APRA’s 10% line in the sand for investor credit growth to date but that line is still there and will apply incremental pressure over time. Moreover, Westpac yesterday provided evidence that that and other APRA efforts are now biting, from Banking Day:
Westpac has raised its loan serviceability hurdle, increasing the minimum assessment rate 30 basis points from 6.8 per cent to 7.1 per cent, as part of a move to tighten its mortgage underwriting.
