"The End of Foreigners Buying Australian Property"

Wondering about this too.
Any reason why getting a loan in Australia is preferable for foreigner? I'd thought it will be easier through the bank within their own country

 

Not recently.
We know Westpac was holding $1 for every $77 lent out though. They're also heavily involved in the foreign lending.

Also, do we really need more evidence the banks are trying to avoid a RC? They're making moves they've never made before and pretending they only recently discovered dodgy brokers.

 

NAB have tightened the noose a little more today as well...

Reduced LVR to 60% for non resident lending, and shaved the income they'll accept...

 

And joining the conga line...

 

And the double dissolution may help them. I bet they hope its not a ALP win

 

Many would prefer to get a loan with their local bank outside of Oz, at much lower interest rates too, however, many bank will not do a resi lend for property outside of their 'jurisdiction' due to the difficulty and costs in acquiring the property in case of default.

 

Another huge risk with OTP property (especially units). Banks change their criteria, and some people will be unable to settle....
It may collapse like a house of cards.

Property UpdateIs this the end of foreign investors buying Australian property? - Property Update

 

Buyers, sellers to prove residency status

 

The golden age of Australia’s Chinese property boom may well be coming to an end.

 

Haha, you don't think NSW is about to unleash similar tax changes? June 21, Locked in Eddie!
QLD will follow a bit behind though, the lucrative and economically responsible absentee lvt can't be ignored!!

 

But is it financed in $A or $S??

eg who is taking the exchange rate movement risk?

 

I"m not sure what's the lending policy is like
A$ and S$ has been on 1:1 for quite a while

 

It's only been 1:1 in the last year. Long steady decline from 1:1.3 a few years ago.

 

Got caught out... I was a tourist, 1:1.3 is like 1:1 to me went there end of 2013 and early this year

 

Your choice, buyer makes an 'informed' decisions re currency. Higher risk and higher returns/ losses.

 

AMP have joined the merry go round... another lender placing Chinese based borrowers on the &*#* list!

 

Lots of restrictions on this - with some lenders who will accept overseas income/borrowers flat out rejecting anything from China.

We've still got funding lines which will take these for now, so are seeing a lot of developers having to send through their lists of their settlement defaulting overseas investors to get them over the line.

A lot of anxious developers within 95% completed sites at the moment.

 

This is now a mini armageddon....remember that now for upcoming settlements many buyers cannot obtain finance and as a result they forego their 10% deposit....ok what does that mean?

Well, most of these were sold at prices that locals would not buy at - perhaps 20% overvalued - and a developer may have forked out a 5% comm or more to a agent....

So chinese buyers has two options:
1. Walk away and lose 10%
2 Pay high interest rates from private lenders up to 12% with 2bps upfront

Most of them are scoffing at the private funding and walking away.

As a result the developers now need to sell the apartments in the secondary market....good luck!!!! lots of anxiety here - particularly with apartments less than 50 sqm which there are many. Developers are getting on the front foot and offering huge comms to sell these now in the secondary market, in one case, for a 40 sqm apartment the commission is 12%, of course with these incentives - they will not value up and local buyers will not be stupid enough to buy them...

Oh well, I will watch this space. We are trying to help as many as possible but up to 2 weeks ago they saw Latrobe's offering as too expensive and now - in order to settle they are paying double....

Cheers Ivan

 

How are they dodgy loans?

We applied for a new loan just after New Year , and I can assure you; an internal examination was about the only thing that was not performed in the process of qualifying us - and for only half of the purchase cost!!.

 

Have to say i disgree.

We are inundated with enquiries from Non resident borrowers or brokers with NR clients wishing to settle forthcoming purchases.

Cheers


Richard