The Real Estate Institute of Queensland (REIQ) is welcoming the Federal Treasurer’s move to improve access to home loans for young Australians with student debt and finance for small developers falling short of a perfect, 100 per cent pre-sales uptake.
REIQ CEO Antonia Mercorella welcomed the new APRA/ASIC guidance which would exclude HECS/HELP debts from bank’s mortgage serviceability assessments in certain circumstances, while still maintaining strict responsible lending protections.
“We support this reform which will boost the borrowing capacity of Australians with student loan debt and trust that it will aid first home buyers in taking that crucial first step onto the property ladder,” Ms Mercorella said.
“This change aligns with the REIQ’s ongoing advocacy to enhance homeownership opportunities across Queensland.
“It’s a step in the right direction to help first home buyers overcome the significant hurdles they face in today’s market and economy.”
APRA’s mortgage serviceability assessment examines whether a borrower can maintain loan repayments if the RBA raises the cash rate by an additional 3 percentage points, beyond its current rate of 4.35 percent.
Ms Mercorella said while a rate cut was being largely tipped ahead of the Reserve Bank’s meeting next week, she reminded borrowers to always apply a degree of caution when taking on a mortgage.
“Even with a potential rate cut on the horizon, it’s essential for borrowers to approach home loans with caution,” she said.
“When taking out a loan, it’s important to not just think about what interest rates are today but consider whether you’re going to be able to service that mortgage in the event that interest rates go up.
“It’s easy to get swept up in the excitement of buying a home, but it’s important to think realistically about what you can manage long-term so that you are able to service that mortgage even if interest rates change or your personal circumstances shift.”
ENDS
Media enquiries:
Claire Ryan, Media and Stakeholder Relations Manager, The Real Estate Institute of Queensland
M: 0417 623 723 E: media@reiq.com.au