The Banks Have Greater Appetite For Investment Risk

The banks are increasingly taking their foot off the brake on home lending, particularly for ‘riskier’ loans, according to APRA’s recently released quarterly banking figures. The banking regulator’s data shows new residential home loans to borrowers with a high debt-to-income ratio increased by 22.3 per cent between the September and December 2019 quarters.

Low deposit loans – those with an LVR of 95 per cent or higher – jumped 17.5 per cent from the previous quarter while interest-only loans increased by 7.9 per cent over the same time period, after coming off a low base. In doing so we have seen a mini property boom with many buyers entering the Sydney market once more.