All aboard the rate rise train - Macquarie Bank 0.27%

It's the magic number.

"
In response to market conditions, including investor lending restrictions, we are making the following pricing changes:

· fixed and variable rates for new investment home loans to increase by 0.27% pa, effective Friday 31 July 2015

· variable rates for existing investment home loans to increase by 0.27% pa, effective Monday 10 August 2015.
"

 

And when there's another rate cut, watch them double dip with the same excuse. Watch them triple dip. They're going to go George Costanza on our asses.

 

Son of a b***h!

I had lunch today with the state manager from Macquarie, no mention was made of this.

I'm thinking the best way to deal with this is rather than panic refinancing, people would be best served to wait a few more weeks (months?) for the dust to settle. No easy answers here.

 

Had the same thing happen to me with ANZ on Thursday - he clearly didn't know the change was coming as he was jabbering on how their rates weren't *too* bad for investors.

Bzzt.

 

Lol - wait until CoB Friday to broadcast the bad news.

ANZ's PR team needs to learn from this. They always seem to be the first to deliver bad news - then the rest follow.

Cheers

Jamie

 

Hi can someone advise.

Is a topup loan against an ip (funds used as deposit to buy ppor ) considered an investor loan?

 

Interesting times ahead,

 

I feel hurt for the first home buyer already ... ><

All the cost of funding will be passing down from big banks to big investors and flow to small investors then ultimately vulnerable first home buyers and renters.

 

Except those First Home Buyers are now getting access to some of the cheapest rates in Australian history - especially thanks to APRA.

Even first time investors - outside of LVR squeeze aren't getting hit too hard, it's primarily those with an established portfolio who are needing to restructure and strategise how to they progress under the new regime.

 

Totally agree Corey
Those highly geared investors and FHB with very small deposit are the one getting pinch.

With hot Sydney market, I have some inquiries from people with very little deposit wanted to buy first home.... feel the pain for them.

 

Choo! Choo!

 

And if next month the RBA drop rates again?

 

As I said, they'll double dip with the same excuse. Costanza style.

 

What constitutes "Investment Home Loan" with MacQ? Our PPOR mortgage is with them, it's called "Offset Home Loan" on the online banking. It has a few splits for deposists on 2 IP's plus our main PPOR loan. Tgeplsits are all secured against the PPOR but were used for the IP deposits. Does the whole loan count as a home loan, rather than investment loan in this case?

 

I would guess yes, a loan secured by an IP (regardless of the purpose) is in the firing line, as it is part of the risk equation that APRA is targeting

edit: and obviously, the interest won't be tax-deductible as the purpose is not income-producing

 

Hearing that Macquarie will need to make some very big additional adjustments in the coming weeks, over and above the changes already announced. APRA has told them they haven't gone close to doing enough yet.

On the subject of AMP - I am told they will be completely withdrawing from accepting INV properties as security immediately - expect an announcement this afternoon or tomorrow.
I'm led to believe all existing variable debt will be going up @ 45bpts and all pre approvals will be going up @ 100 bpts . They will be exiting SMSF lending as well, I am told. Loans secured by O/Occ security will be seeing aggressive reductions - very low 4%'s Im told.

I'm also hearing CBA and Westpac have been told they havent done enough and need to do significantly more...

This next 7-10 days might be the biggest shift in the lending landscape in decades.

 

So is sit and wait the best thing to do for now? Wait until this shift in interests rates settles before deciding what to do next?

 

I'm thinking that all the adjustments to investment policy isn't going to have any real effects. The real outcomes of all this will be the smaller lenders will capture a larger market share, but investors will still want to borrow money. These rate rises are only bringing rates for investors back to what they were in January this year and the market was still hot then. A couple of interesting things I read in this mornings paper:

* Glenn Stevens (RBA Chairman) has indicated that they're not anticipating any further rate drops.
* He's also mentioned that investment loan rate rises is exactly what he's been wanting the banks to do.

To really slow the investment market, a few things probably need to happen:
* The RBA needs to increase rates (not just investors, but scare everyone!).
* The government needs to get very tight on foreign investment.

 

You're correct that it only brings rates back to earlier levels, but the wider impact is that it doesn't bring borrowing capacity back to January levels, it brings it back to post GFC levels. ( in the case of Westpac, perhaps prehistoric levels ) And lets be cautious about just how much business can migrate from the majors to the smaller lenders and non banks . They already wouldnt write a lot of what the majors would, pre APRA. They arent likely to get any significantly more generous now. But yes, they will absorb some business- no doubt. This is why these changes wont lead to a collapse, but rather a slow down.