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ACCESS TO CREDIT

Now I’m not talking about interest rates here, but a borrower's actual access to credit. Rising interest rates tend to prompt lenders to tighten their lending standards so borrowers can’t borrow as much.

When our Banking Regulator APRA was concerned about the rapid growth in lending to property investors which led to steep increases in property prices in 2014, it instructed the banks and other lenders to be more cautious and set stricter criteria for determining whether borrowers could repay their loans if interest rates were to change.

This warning had the desired effect and the share of new loans to investors fell from over 40% during 2014 -15 to less than 30% the next year.

On the flip side, during the pandemic boom, banks eased lending standards in a move designed to free up credit and revive the economy - and it worked, hence the price surge.

RealRenta has all the tools that a property manager hasbut for less than ¼ the cost of a property manager.

Join now and the cost is less than a cup of coffee a week to manage your rental property.

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Jason Gwerder
Thursday, 31 August 2023


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