AMP, one of Australia’s largest financial institutions, is calling a halt to all investor lending until the end of the year.
It’s part of a stream of announcements from major Australian financial institutions around their investor loans, and follows mounting concern among regulators about speculation in the property market, especially in Sydney.
In a statement AMP said that it would increase variable rates on all existing investor property loans by 0.47% per annum from 7 September 2015.
All investor applications approved during this period will also be subject to the 0.47% increase upon settlement, the bank said.
In addition to the increase in investor home loans rates, the bank confirmed that it will not be accepting new or assessing existing investor property lending applications from today.
This is expected to last until later in 2015, depending on market conditions, it noted.
“Australia’s property market is experiencing high levels of investor property lending growth and we are supportive of the regulator’s intention to slow this growth to appropriate levels,” said Michael Lawrence, AMP Bank managing Director.
“We appreciate the position this puts our customers in and will be working with our distribution network to actively communicate with them”, he added.
The bank acknowledged the change in policy was in response to APRA guidelines to limit growth in investor property lending across the market to 10%.
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