Short takeaway:
The Coalition says it’ll push the financial regulator to ease up on home loan approval rules. Their shadow housing minister claims almost 40% of first-time buyers can’t get a loan because of a tough "serviceability buffer." If the Coalition wins the election, they promise to update APRA’s rules.
Master Builders welcomes today’s announcement from the Federal Opposition to ease home loan approval rules.
The proposed change aims to help more young people purchase their first home. The financial regulator requires banks to include a safety buffer when assessing a loan applicant’s ability to repay. This buffer is currently set at 3 percent above the loan interest rate. It was increased to 3 percent during the COVID pandemic, when the official cash rate hit a record low of 0.1 percent.
Master Builders also supports the Opposition’s commitment to tackling housing supply issues through infrastructure investment, reducing red tape, and addressing supply chain and workforce constraints.
The combination of initiatives that make it easier to get finance, that speed up processes for planning and building and make it easier for people to work in the sector is necessary to build more homes.
Quotes attributable to Master Builders Australia CEO Denita Wawn:
“The current regulatory framework has made it increasingly difficult for prospective homeowners to enter the market, despite their ability to afford repayments.
“Access to finance is a critical issue for aspiring homeowners. A more balanced approach will help more people access the housing market.
“We cannot build more homes for Aussies without tackling the bottlenecks in our industry.
“Funding essential infrastructure, cutting red and green tape, and investing in growing our workforce are crucial measures to support builders and meet our Housing Accord objectives.
“Master Builders will continue to work with all sides of politics to ensure policies support a strong and sustainable building and construction sector and end the housing crisis.”