Latest news with #LoanMarket
News.com.au
12-08-2025
- Business
- News.com.au
Rate cut could trigger buying boom
The Reserve Bank of Australia's decision to cut the cash rate for the third time this year is set to ignite the spring property market, but experts warn it's bad news for those trying to break into the housing market. The cut, which brings the cash rate down to 3.60 per cent, is expected to unleash a wave of buyer activity, driving up competition and potentially pushing prices even higher. New data already reveals a surge in home loan pre-approvals, indicating buyers were betting on a rate cut and are now poised to flood the market. Loan Market reported a massive 53 per cent jump in pre-approvals during July compared to last year, as buyers scramble to secure finance amid dwindling housing stock. Across the states, SA and the NT are leading the charge with pre-approvals up 80 per cent. In WA, pre-approvals are up 79 per cent and 49 per cent in NSW and the ACT. Queensland records pre-approval rates of 48 per cent, while 46 per cent of homeowners in VIC and TAS are ahead of the game. This spike in pre-approvals comes amid already tight stock levels. Ray White data shows new listings are down 14.2 per cent compared to this time last year, adding further pressure to an already competitive market. David McQueen, CEO of Loan Market, said buyers are looking for every advantage they can get. 'Market listings are sitting at a three-year low, which is making it tough for buyers,' he said. 'They're looking for every edge and that starts with knowing exactly what they can borrow and afford to repay. Buyers want to walk into an auction with confidence or put forward strong private treaty terms that help them stand out.' Experts weigh in In this month's Finder RBA Cash Rate Survey, almost all experts (91 per cent) correctly predicted the RBA's move. Graham Cooke, head of consumer research at Finder, said all eyes are now on the banks to pass on the savings to customers. 'Following recent rate cuts by the Reserve Bank of Australia, lenders are under immense pressure to pass the savings on to customers. So far, most have passed on the cuts in full.' Cooke also cautioned that lenders might start to pull back on the size of future rate cuts as more are predicted. He urged homeowners to review their home loans, stating, 'If your current mortgage rate is higher than 5.5 per cent, you may be able to find a better deal.' MORE NEWS: 'Strict': New pet ownership law sweeps Aus Affordability boost Finder analysis reveals the suburbs where house and unit values are now affordable following the three rate cuts. The average single Australian can now feasibly afford a place for $570,000 or less, and the average Australian household with two incomes can look at suburbs where average prices are under $1,167,000. Following the rate cuts, the median house in Wyndham Vale and Wodonga in Victoria is now affordable for the average Australian. For a couple with two average incomes, a house in Coburg is now affordable in Victoria. In New South Wales, a couple with two average incomes can now afford a house in Oran Park, Marsden Park, Glenmore Park, and Leppington. Shock salary you now need to buy a home Following three rate cuts from the RBA, the average Aussie on a single income can now afford a house in Kirwan in Queensland. The average Aussie on a single income in Western Australia can now afford a house in suburbs including Armadale and Mandurah. When it comes to units, the average Australian on a single income can now afford suburbs in Bankstown, Penrith, and Auburn in New South Wales, and South Yarra and Brunswick in Victoria. Australian couples with two incomes can now afford a unit in suburbs including Chatswood, St Leonards, Pyrmont, and Maroubra in New South Wales, and Burleigh Heads in the increased affordability, Cooke warned that increased market activity could drive up prices and deposit requirements, potentially negating the benefits of cheaper repayments. 'Even with a lower rate, you'll still need a hefty deposit. If lower borrowing costs drive increased market activity – as they have in the past – rising property prices and higher deposit requirements could ultimately outweigh the benefit of cheaper repayments.'
1News
11-08-2025
- Business
- 1News
How many home loan applications are turned down - and why?
Only a small number of people applying for home loans are being turned away - and usually there is a way to get them across the line in future, brokers and banks say. Loan Market adviser Karen Tatterson said she would normally talk to clients before she set up a meeting to understand their financial situation and whether they were in a position to go ahead with a home loan application. She said in 80-90% of cases, people were able to apply. "If they are not then I would normally undertake some planning with them and set out a pathway to get them in that position." That might include setting savings goals and a timeline to get to the point where they would qualify for a home loan. ADVERTISEMENT "I would then agree to a check in in a nominated timeframe - say three months or six months depending on their circumstances and agree to touch base with them again for a review. I often do a periodic check in to see how they are going with their plan. "Ironically, most people I see or speak to are actually ready to buy. They are more often than not seeking an understanding of and support through the approval process." The morning's headlines in 90 seconds, including dire state of our heart health system, where unspent charter school money might go, and thieves make off with a pricey haul of Labubu dolls. (Source: 1News) There was $4.6 billion in new lending for property purchases in June across 7700 borrowers. At Squirrel, chief executive David Cunningham said fewer than 5% of applications for a home loan were declined. "An adviser has multiple options so that would likely be materially lower than for a bank. Also, low-quality deals would be less likely to be submitted by a broker." He said people were sometimes told to reduce or eliminate their personal debt and buy now pay later, and build their savings. ADVERTISEMENT Westpac said when an application did not meet its criteria, the bank tried to work with the customer on ways to improve their chances of success in future. "Therefore, while we can't give an exact number of customers who aren't approved for lending, the vast majority are ultimately approved. The most common reasons home loan applications may initially not be approved are that the customer does not have enough deposit, or doesn't meet our serviceability criteria to repay the loan." BNZ general manager of home lending product James Leydon said the number of applications turned down was low. "We understand how stressful buying a home can be and we want to make sure the experience is as smooth as possible. This includes letting customers know what Their likelihood of being able to secure a home loan is, prior to any paperwork or formal application process kicks off. "Having an in-depth conversation upfront prior ensures our home loan partners not only understand the customers' situation at the time of enquiry but also enables them to make suggestions on how a customer can improve their financial situation and secure a pathway to home ownership." Glen McLeod, head of Link Advisory, said most people he met were eligible to apply, even if they first believed they were not. ADVERTISEMENT "When we assess their situation, we explore a wide range of low-deposit purchase options, including support through Kāinga Ora's First Home Partner and the First Home Loan scheme. These initiatives are designed to help first-home buyers with smaller deposits enter the market. "It's also possible to secure a loan of up to 90% of the property's value through several banks, especially when clients have a live deal in place and meet affordability criteria. Some lenders may consider 95% lending under specific conditions, though this is less common and subject to stricter assessment. "For those just beginning their home ownership journey and who haven't yet saved a deposit, we work closely with them to build a plan. This includes strategies to grow their deposit, improve financial habits, and assess affordability. In these cases, it's rarely a 'no'-more often, it's a 'not yet'." He said sometimes people could be approved with help from family. "Ultimately, fewer than 5% of the people I speak with are unable to move forward. That means for the vast majority, there is a way-and we're here to help them find it." What do you need? Income ADVERTISEMENT The income you need to be able to buy a house depends on your circumstances - banks look at things like whether you have kids, how many cars you're running and what other financial commitments you have. As a general indicator, a couple with a joint income of $150,000, two children and two cars might be able to borrow about $900,000. You'd need an income of about $102,000 in that scenario to borrow $500,000. Deposit You generally can get a loan with a deposit of 10%, although it helps if you have a deal already signed with a seller (with a finance condition). If you're a couple earning less than $150,000 a year, a First Home Loan could be an option - this can mean you only need a 5% deposit. Debt Cunningham said it was common to see people with $20,000, $30,000 or $40,000 of debt. But he said it was a problem when the required repayments reduced the amount of income people had available to service the loan. People were often advised to focus hard on paying off debt before they submitted their application. "It might be that you have a flasher can than you need so you might think about trading down." ADVERTISEMENT He said a $5000 credit card debt might not be an issue but when there were three or four loans, it could become a problem. "The big thing is what is the repayment That's a deduction from their income." Buy now pay later could be a headache, too, he said. "For people looking to buy a house, it's not a good idea to use." Decent credit Cunningham said banks would also want to see a good credit history. If the applicant had defaulted on a debt or was frequently behind on their bills, it mighrt make it harder to get approval. It helped if there was a good explanation for why it had happened, he said. As part of the process, the lender or borrower would run a credit check that was "very comprehensive", he said. "Make sure you're taking care of all your bills and if there's something missed, make it up as soon as possible."
RNZ News
10-08-2025
- Business
- RNZ News
How many home loan applications are turned down - and why?
In June there was $4.6 billion in new lending for property purchases across 7700 borrowers. Photo: RNZ Only a small number of people applying for home loans are being turned away - and usually there is a way to get them across the line in future, brokers and banks say. Loan Market adviser Karen Tatterson said she would normally talk to clients before she set up a meeting to understand their financial situation and whether they were in a position to go ahead with a home loan application. She said in 80-90 percent of cases, people were able to apply. "If they are not then I would normally undertake some planning with them and set out a pathway to get them in that position." That might include setting savings goals and a timeline to get to the point where they would qualify for a home loan. "I would then agree to a check in in a nominated timeframe - say three months or six months depending on their circumstances and agree to touch base with them again for a review. I often do a periodic check in to see how they are going with their plan. "Ironically most people I see or speak to are actually ready to buy. They are more often than not seeking an understanding of and support through the approval process." There was $4.6 billion in new lending for property purchases in June across 7700 borrowers. At Squirrel, chief executive David Cunningham said fewer than 5 percent of applications for a home loan were declined. "An adviser has multiple options so that would likely be materially lower than for a bank. Also, low quality deals would be less likely to be submitted by a broker." He said people were sometimes told to reduce or eliminate their personal debt and buy now pay later, and build their savings. Westpac said when an application did not meet its criteria, the bank tried to work with the customer on ways to improve their chances of success in future. "Therefore, while we can't give an exact number of customers who aren't approved for lending, the vast majority are ultimately approved. The most common reasons home loan applications may initially not be approved are that the customer does not have enough deposit, or doesn't meet our serviceability criteria to repay the loan." BNZ general manager of home lending product James Leydon said the number of applications turned down was low. "We understand how stressful buying a home can be and we want to make sure the experience is as smooth as possible. This includes letting customers know what their likelihood of being able to secure a home loan is, prior to any paperwork or formal application process kicks off. "Having an in-depth conversation upfront prior ensures our home loan partners not only understand the customers' situation at the time of enquiry but also enables them to make suggestions on how a customer can improve their financial situation and secure a pathway to home ownership." Glen Mcleod, head of Link Advisory, said most people he met were eligible to apply, even if they first believed they were not. "When we assess their situation, we explore a wide range of low-deposit purchase options, including support through Kāinga Ora's First Home Partner and the First Home Loan scheme. These initiatives are designed to help first-home buyers with smaller deposits enter the market. "It's also possible to secure a loan of up to 90 percent of the property's value through several banks, especially when clients have a live deal in place and meet affordability criteria. Some lenders may consider 95 percent lending under specific conditions, though this is less common and subject to stricter assessment. "For those just beginning their home ownership journey and who haven't yet saved a deposit, we work closely with them to build a plan. This includes strategies to grow their deposit, improve financial habits, and assess affordability. In these cases, it's rarely a 'no'-more often, it's a 'not yet'." He said sometimes people could be approved with help from family. "Ultimately, fewer than 5 percent of the people I speak with are unable to move forward. That means for the vast majority, there is a way-and we're here to help them find it." Income The income you need to be able to buy a house depends on your circumstances - banks look at things like whether you have kids, how many cars you're running and what other financial commitments you have. As a general indicator, a couple with a joint income of $150,000, two children and two cars might be able to borrow about $900,000. You'd need income of about $102,000 in that scenario to borrow $500,000. Deposit You generally can get a loan with a deposit of 10 percent, although it helps if you have a deal already signed with a seller (with a finance condition). If you're a couple earning less than $150,000 a year, a First Home Loan could be an option - this can mean you only need a 5 percent deposit. Debt Cunningham said it was common to see people with $20,000, $30,000 or $40,000 of debt. But he said it was a problem when the required repayments reduced the amount of income people had available to service the loan. People were often advised to focus hard on paying off debt before they submitted their application. "It might be that you have a flasher can than you need so you might think about trading down." He said a $5000 credit card debt might not be an issue but when there were three or four loans, it could become a problem. "The big thing is what is the repayment That's a deduction from their income." Buy now pay later could be a headache, too, he said. "For people looking to buy a house, it's not a good idea to use." Decent credit Cunningham said banks would also want to see a good credit history. If the applicant had defaulted on a debt or was frequently behind on their bills, it mighrt make it harder to get approval. It helped if there was a good explanation for why it had happened, he said. As part of the process, the lender or borrower would run a credit check that was "very comprehensive", he said. "Make sure you're taking care of all your bills and if there's something missed, make it up as soon as possible." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Daily Telegraph
23-06-2025
- Business
- Daily Telegraph
Calls to lift NSW stamp duty exemption limit
ANALYSIS With the NSW Budget for 2025–26 to be announced tomorrow, the government's policy decisions on housing are already locked in. But whatever is unveiled, one thing is clear: it's the bank of mum and dad that's already stepping up to support first home buyers. At Loan Market, we've seen guarantor-backed pre-approvals for first home buyers in NSW more than double in the past year. Around 11 per cent of these now involve a parent using their home as security, up from just 5 per cent a year ago. It's a clear signal: more young Australians are leaning on their families, not because they want to but because they have to. MORE: Refinance at the right time to save big And the challenge goes well beyond house prices. Since 2020, rent in Sydney has jumped 44 per cent, while groceries have increased by 27 per cent at the checkout and other costs, like car insurance have soared by more than 40 per cent. These are everyday pressures, not luxuries, and they're making it even harder for people to save. At the same time, seasoned investors have returned to the market with confidence. At Loan Market, we've seen a 31 per cent rise in investor loans year-on-year. If the government is serious about helping first home buyers, the conversation can't stop at housing supply. Stamp duty is one of the biggest upfront costs they face and it's stopping many from even getting close. MORE: Surprise reason you can be black-listed by a bank Right now, full stamp duty exemptions only apply to properties under $800,000, with partial concessions up to $1 million. That might have worked once, but those numbers don't reflect today's reality. Sydney's median house price sits at $1.46 million, according to PropTrack data. Even the median unit price is $820,000, already above the current threshold. Take a couple trying to buy their first apartment at that median price. If they tip over the $800,000 limit, they could be hit with nearly $33,000 in stamp duty. That's on top of their deposit, legal costs, and moving expenses. And if they're hoping to buy a house in Sydney? The median puts any stamp duty support completely out of reach. Some suggest buyers should just look further out. But for many with jobs in the city, family nearby, and deep community ties moving over 40 minutes away simply isn't realistic or fair. More and more, we're seeing first home buyers invest interstate instead, renting out the property while building equity. It's a smart move in tough conditions but it's also a sign of a broken system. Raising the full exemption threshold to $1.5 million, closer to real-world property prices, would make a genuine difference. Buyers would still need to pass strict lender serviceability tests, including a 3 per cent buffer. But it would ease one of the biggest barriers they face. And we can't forget the broader picture. First home buyers keep the market moving. When they step in, others can upsize, downsize or move where they need. When they're shut out, it slows everything down. MORE: Where super is outperforming house price growth Of course, not everyone has parents who can help. And even when they do, it often comes at a cost like delaying retirement, putting travel plans on hold, or shelving downsizing. That's where great brokers make a real difference. They help structure a pathway to reduce the debt and remove the guarantor as soon as it's viable. It's not about cutting corners, it's about smart, sustainable solutions. There's also a case for stamp duty exemptions or concessions to be given to retirees, as well. If empty nesters were encouraged to downsize from their large family homes, there would be more supply in the market for families looking to upsize. Greater supply in the market provides more choice and sustainability in prices. Stamp duty reform has been debated for years. The question now is whether tomorrow's budget will finally shift from talk to action. This isn't just a policy choice. It's an opportunity to back Australians who are doing everything right – working hard, saving hard, and leaning on family when there's no other option. It's time to support the parents who've been carrying the load, and the next generation trying to find their place in the market. It's time to turn intent into action. Here's hoping this budget delivers for those working hardest to get their start or for young Australians to get the same opportunities like others before them. David McQueen is Loan Market CEO
News.com.au
23-06-2025
- Business
- News.com.au
Calls to lift NSW stamp duty exemption limit
ANALYSIS With the NSW Budget for 2025–26 to be announced tomorrow, the government's policy decisions on housing are already locked in. But whatever is unveiled, one thing is clear: it's the bank of mum and dad that's already stepping up to support first home buyers. At Loan Market, we've seen guarantor-backed pre-approvals for first home buyers in NSW more than double in the past year. Around 11 per cent of these now involve a parent using their home as security, up from just 5 per cent a year ago. It's a clear signal: more young Australians are leaning on their families, not because they want to but because they have to. And the challenge goes well beyond house prices. Since 2020, rent in Sydney has jumped 44 per cent, while groceries have increased by 27 per cent at the checkout and other costs, like car insurance have soared by more than 40 per cent. These are everyday pressures, not luxuries, and they're making it even harder for people to save. At the same time, seasoned investors have returned to the market with confidence. At Loan Market, we've seen a 31 per cent rise in investor loans year-on-year. If the government is serious about helping first home buyers, the conversation can't stop at housing supply. Stamp duty is one of the biggest upfront costs they face and it's stopping many from even getting close. Right now, full stamp duty exemptions only apply to properties under $800,000, with partial concessions up to $1 million. That might have worked once, but those numbers don't reflect today's reality. Sydney's median house price sits at $1.46 million, according to PropTrack data. Even the median unit price is $820,000, already above the current threshold. Take a couple trying to buy their first apartment at that median price. If they tip over the $800,000 limit, they could be hit with nearly $33,000 in stamp duty. That's on top of their deposit, legal costs, and moving expenses. And if they're hoping to buy a house in Sydney? The median puts any stamp duty support completely out of reach. Some suggest buyers should just look further out. But for many with jobs in the city, family nearby, and deep community ties moving over 40 minutes away simply isn't realistic or fair. More and more, we're seeing first home buyers invest interstate instead, renting out the property while building equity. It's a smart move in tough conditions but it's also a sign of a broken system. Raising the full exemption threshold to $1.5 million, closer to real-world property prices, would make a genuine difference. Buyers would still need to pass strict lender serviceability tests, including a 3 per cent buffer. But it would ease one of the biggest barriers they face. And we can't forget the broader picture. First home buyers keep the market moving. When they step in, others can upsize, downsize or move where they need. When they're shut out, it slows everything down. Of course, not everyone has parents who can help. And even when they do, it often comes at a cost like delaying retirement, putting travel plans on hold, or shelving downsizing. That's where great brokers make a real difference. They help structure a pathway to reduce the debt and remove the guarantor as soon as it's viable. It's not about cutting corners, it's about smart, sustainable solutions. There's also a case for stamp duty exemptions or concessions to be given to retirees, as well. If empty nesters were encouraged to downsize from their large family homes, there would be more supply in the market for families looking to upsize. Greater supply in the market provides more choice and sustainability in prices. Stamp duty reform has been debated for years. The question now is whether tomorrow's budget will finally shift from talk to action. This isn't just a policy choice. It's an opportunity to back Australians who are doing everything right – working hard, saving hard, and leaning on family when there's no other option. It's time to support the parents who've been carrying the load, and the next generation trying to find their place in the market. It's time to turn intent into action. Here's hoping this budget delivers for those working hardest to get their start or for young Australians to get the same opportunities like others before them.
