You may have heard the news about potential changes to responsible lending laws which may make it easier to borrow, although there is a heavy emphasis on the word “potential”.
As with any proposed change, it needs to go through a bout of scrutiny and must also be passed through parliament before it can be enacted. In the case it does get legislated, we expect to see a reduction in the amount of paperwork required to borrow, which could see a quickening of the approval process and potentially even an increase in borrowing capacity and activity.
In this humble mortgage brokers opinion, we already see that most areas of the market (especially in Sydney and Brisbane where most of our clients are buying) are quite in demand already, so the relaxing of these laws could give another push upwards to property prices (hopefully not a repeat of the 2013 – 2017 boom if you’re a first home buyer!). The forecast from some economists for the property market over the next few years has gone from a 30% drop to a 15% increase, and this didn’t take into consideration any lending law changes, so it will be interesting to see what actually does transpire!
I personally do believe there is a very good chance these laws will be passed given the amount of seats the government holds, although they are not scheduled until March, so there are still 2 more selling periods to go before that happens in Spring and Summer. As with any change, there tends to be a flurry of activity, so it’s better to be well prepared before then if you’re considering buying in the near future.