Residential Loans

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Data released today from the Australian Bureau of Statistics (ABS) has revealed that home loan demand surged in January 2020.
The total value of loans to owner-occupiers rose 6.1% over the month of January, while the total value of loans to investors rose 3.6% over the month.
Mortgage Choice Chief Executive Officer Susan Mitchell said, "The latest data from the ABS shows that the nation's housing market kicked off 2020 with a bang, continuing the turnaround in the second half of 2019."
"The strong growth across both owner-occupiers and investor borrowers was larger than expected. Heightened borrowing activity suggests that the ongoing growth in dwelling values is likely to persist for some time yet."
"Indeed, the latest figures from CoreLogic reveal that national dwelling values surged by 1.1% over February, with values across five of the nation's eight capital cities reaching a record-high."
"Extremely attractive home loan interest rates and more relaxed lender policy may be fuelling investor demand. We are seeing competitive pricing on longer-term fixed rate home loan products, with some lenders offering rates below 3%, which is unprecedented.
"While we can only speculate on the outlook of investors going forward, the uncertainty in both the domestic and global economy may be encouraging consumers to invest their money in stable asset classes. As the expression would suggest, investors may be choosing to park their funds in property, which is safe as houses.
"Only time will tell if the momentum will continue long-term. As the global and domestic economic outlook faces significant headwinds, property investors may park their buying plans.
Looking to the future, Ms Mitchell said while there is some uncertainty ahead, demand for property is likely to remain robust.
"Interest rates have fallen to new historic lows and may fall even further in coming months. As such, now may be a good time for buyers hoping to take advantage of competitive home loan deals to discuss their options with their local mortgage broker," concluded Ms Mitchell.
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Home loan demand surged in January

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ANZ Banking Group and Westpac Banking Corp have discovered they have each approved "hundreds" of home loans backed by fraudulent Chinese income documents, the Australian Financial Review has claimed.
They were allegedly manufactured with the help of dodgy mortgage brokers.
"Westpac staff undertake verification for foreign income including obtaining pay slips and bank statements in both the relevant foreign language as well as getting those documents translated," Westpac  spokesman David Lording said in response to inquiries from The Australian Financial Review.
"We have identified an issue with some loans that we are currently investigating." 
ANZ spokesman Paul Edwards confirmed the bank had experienced problems "with the income documentation of a small percentage of borrowers who rely on foreign income".
"Policy changes have been made to address this and we are also reviewing a number of brokers," Mr Edwards said.
ANZ and Westpac have also informed regulators and the police.
Asked whether the Chinese frauds had influenced Westpac's decision to withdraw from foreign lending, Mr Lording said "while foreign income verification is more operationally difficult, the primary driver of our decision was the changes in capital and funding requirements".
The paper advised today the lending boom to Chinese nationals for residential and commercial property in Australia was always "a little fraught."
"We never knew where the money was coming from," says the insider, who asked not to be named.
The unfettered lending to Chinese nationals for residential property came to a halt this week as the National Australia Bank followed its peers in tightening lending restrictions for foreign buyers.
"NAB has limited appetite for this segment which comprises less than two per cent of the NAB book," a spokesperson said advised The Australian Financial Review.
NAB's new rules, which will see increased loan to value ratios and the recognition of just 60 per cent of foreign earnings, will come into effect on Saturday.
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