ANZ, CBA raise mortgage rates
S Y D N E Y: Two of Australia’s largest banks jacked up mortgage rates for speculative buyers yesterday as part of an intensifying campaign by regulators to hose down a heated housing market.
The out-of-cycle hikes came at a time when the central bank held rates steady for an eighth straight month this month, citing the “build-up of risks” in home prices and household debt.
Speculation was high that the main watchdog, the Australian Prudential Regulation Authority (APRA), was about to tighten the screw on bank lending, adding to rules imposed in 2015.
Treasurer Scott Morrison all but confirmed that steps were afoot in a news conference yesterday, saying he and the regulators were “concerned” about the resurgence in investment borrowing seen in the last few months.
“The next step was to make any announcements they think necessary to address the issue,” said Morrison.
Already the banks have responded to the pressure by hiking rates on investment loans, and particularly interest-only loans favoured by speculators.
ANZ yesterday raised its variable interest rates on investor loans by 25 basis points (bps) to 5.85 per cent, effective March 31.
It lifted rates on interest-only loans by 11 basis points to 5.85 per cent for investors and by 20 bps to 5.25 per cent for owneroccupiers. The changes are effective April 22.
Variable interest rates for owner-occupiers who repay both principal and interest remain unchanged at 5.25 per cent.
Commonwealth Bank of Australia said it was raising rates on interest-only and investment home loans by between 24 and 26 bps, effective May 8. Reuters