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Analysis and Comment (14)

Lending standards are so tight that even former Fed Chairman Ben Bernanke, center, who until recently was one of the most powerful people in the world, can’t refinance his mortgage. Reuters

Ben Bernanke among borrowers paying the price for knee-jerk home loan rules

It’s clear mortgage standards have gotten too tight when even a former Federal Reserve chairman who makes as much as US$250,000 per speech cannot refinance his home. Ben Bernanke complained about his inability…
Is our thinking on house prices blurred by irrationality? Kesu/Shutterstock

Rational talk on housing prices lost in a bubble

The latest house price index figures released by RP Data earlier this week show a year-on-year increase in property values in Sydney of 14.3%. This has sparked the current hot debate on property prices…
Dealing with housing bubbles can get messy for central banks. Shutterstock

Home loan limits and buffers won’t stop a housing bubble

Australia’s central bank has formally flagged the use of macroprudential tools to address what it called “unbalanced” lending in its most recent Financial Stability Review. Loan-to-valuation ratio (LVR…
Mortgage broker home loans are riskier than those from banks. monkeyc.net/Flickr

To tackle risk, address how mortgage brokers are paid

Heightened competition among home lenders has prompted the banking regulator to issue a reminder of what constitutes prudent lending, but its suggestion that loans being generated by mortgage brokers should…
An increasing number of consumers choose a broker over going direct to a bank for their home loan. Dan Peled/AAP

Looking for a home loan? Choose from one of these four options…

Over 40% of mortgages in Australia are sold by mortgage brokers, not by their manufacturers - an issue that has the CEO of Australia’s fifth largest bank, Suncorp, arguing the sector is skewed towards…
Coles is believed to have applied for an Authorised Deposit-taking Institution licence, which would allow it to take deposits. AAP

Mortgage price check in aisle four as Coles banks on future

The news that Coles may be seeking a banking licence would, if confirmed, put the supermarket group and its parent company Wesfarmers in direct competition with Australia’s major banks. It would allow…
The proportion of renters is now roughly equal to the numbers of outright home owners. Image from www.shutterstock.com

Home equity: Australia’s growing wealth divide

For all our talk about housing affordability, few people want house prices to drop. That’s because most Australians are home owners, and much of our wealth is stored in housing. But recent figures released…
Calculating a household’s residual income is a more accurate measure of housing stress. Image from www.shutterstock.com

Just how stressed are we when it comes to housing affordability?

Property pundits are hoping the Reserve Bank of Australia’s latest cut to interest rates will help stoke the country’s flat property sector into life. But Australia’s housing remains highly over-valued…
A former mortgage broker - who is now facing fraud charges - has blown the whistle on predatory lending practices in Australia’s financial services industry. Image from www.shutterstock.com

There are predators in our own backyard, but where are our financial watchdogs?

The level of sub-prime mortgages in Australia may be far in advance of what was previously assumed and provided for by banks. The story was broken on the ABC, and covered elsewhere. The revelations centred…

Research Briefs (2)