kekkles
Australias Property Bubble Bursting
Ian Young
Kevin Russell
Stay in cash, don't buy. Prices will go lower yet for another year or two.
Brayden Murphy
Its funny how data makes people upset
Look at the gains, what's there to cry over
Christopher Ramirez
Credit momentum continues to lag.
Ayden Wilson
What happens in 2020 when all these IO loans that originated in 2015 have to rollover but they're in negative equty because we're already unwound to 2015 prices?
The bulk of the rollovers in 2019 are from 2014 and prior but 2020 is mostly going to be people who bought just under the peak. 2021 same again.
Alexander Gonzalez
About half of all mortgages originating in 2015 were IO.
Jack Taylor
Hence we're still ages from the bottom. Throw in a recession/big economic slowdown being pretty likely in the next 2-3 years, the RBA's pathetically low rates and this time with no China to bail us out and we're in a very very bad place
Charles Reyes
afr.com
>Low rate terms on interest-only loans are expiring and it has been estimated that about about 650,000 borrowers with loans totalling around $230 billion could struggle to refinance, according to Morgan Stanley.
>"A key contributor to slowing credit growth is that many investors have switched from interest-only mortgages to principal and interest," Mr Kusher said.
>"Previously, these borrowers weren't paying off the principal on their mortgage, now that they are, coupled with far less investor mortgage demand, they are paying back their principal and fewer new investor mortgage applications are occurring which in turn contributes to the ongoing slowing of investor credit growth."
Noah Green
>About 650,000 borrowers with loans totalling around $230 billion are 'trapped' in their interest-only loans and could struggle to refinance, forcing many to sell into already deteriorating property markets, according to investment bank Morgan Stanley.
>Borrowers will need to extend the interest-only period, switch to a principal and interest loan or find a buyer for their property as their low rate terms expire, warns the analysis, which was done in conjunction with AlphaWise, a customised researcher for hedge funds and finance companies.
>"Almost half of interest-only borrowers are 'trapped'," the analysis warns.
>"These households appear high risk on a variety of metrics, and we expect added selling pressure on the housing market when their interest-only periods expire in the next two years."
John Howard
This is a year old, I'd love to see the new one given Sydney fell ~10% yoy since then and Melbourne ~7%.