Looming rate rises could plunge some over-leveraged households into financial distress and cause property prices to fall, the banking regulator told the Albanese government in a frank assessment of the nation’s property market.
“More broadly, frequent natural disasters, increasing geopolitical tensions and cyber threats, and the lingering impact of COVID-19 are creating volatility in financial markets, increasing cost pressures for all industries and heightening risks in the financial system.”and said households had become more leveraged after years of historically low interest rates.
“The faster-than-expected emergence of inflationary pressures and a rising interest rate environment is likely to place some strain on household balance sheets and place a number of households in financial distress.”Despite the existence of “substantial mortgage repayment buffers”, the regulator said “a number [of borrowers] will experience loan repayment shocks as interest rates increase”.
APRA’s advice to the incoming Albanese government on its shared equity housing scheme was redacted from the document.
So APRA oversaw the sustained period of record low interest rates during the years of the Morrison Government, and did nothing? And now it sees fit to 'warn' the AlboMP Government of trouble ahead? No wonder the Chair of APRA is standing down early. 🙄
“APRA tries to blame Labor for the mess they created” FTFY
APRA chairman let the bubble blow up for years, now that the chickens are coming home to roost he steps down to avoid responsibility!
Gamble responsibly. 🎲 🎲
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