Interest-Only Home Loan Restrictions Start to Bite in Australia
Residential buildings sit among trees in the suburb of Frenchs Forest in Sydney, Australia, on Saturday, Oct. 18, 2014. Sydney’s median home price rose 14 percent from a year earlier in September to A$655,000 ($568,900), an RP Data CoreLogic Home Value Index showed Oct. 1.
Photographer: Brendon Thorne/BloombergThis article is for subscribers only.
Regulatory curbs aimed at slowing the growth in riskier property lending in Australia are starting to bite.
The proportion of new lending to interest-only borrowers fell to the lowest level in more than eight years in June, according to data from the Australian Prudential Regulation Authority. The regulator in March sought to cap such loans, traditionally favored by property investors, at 30 percent of total new residential mortgages.