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Prime Minister Anthony Albanese\u2019s 5 per cent deposit scheme has been exposed to some risk as prices fall. Picture: Martin Ollman<\/p>\n
ANALYSIS<\/p>\n
If something was in absolutely no danger, we used to say it was \u201cas safe as a bank\u201d.<\/p>\n
See, banks are these rock solid institutions, full of money and setting new profit records year after year \u2026 especially in Australia.<\/p>\n
The other term we might use was \u201cas safe as houses\u201d. Our home values have also been steady and reliable, with consistent growth over the decades, due largely to our national obsession with owning or investing in property.<\/p>\n
Our $13 trillion love affair with property has seen the home loan space become incredibly fertile ground over the years, supporting growing numbers of banks, credit unions, mutuals and other forms of lender. <\/p>\n
MORE: Every \u2018terrible\u2019 Block room up close<\/a><\/p>\n The result has been the situation we find ourselves in today, with more than 100 lenders in the Australian market.<\/p>\n Our banking system is the envy of the world. <\/p>\n Cast your mind back to the Global Financial Crisis, where bank collapses and massive taxpayer bailouts were widespread across the USA and Europe.<\/p>\n Canstar\u2019s Sally Tindall said the lending environment was putting pressure on banks.<\/p>\n Down in the little old land of Oz? Not a peep. Our banks were steadfast, due largely to a history of conservative lending practices and robust regulation for our financial institutions.<\/p>\n But suddenly, there\u2019s one less lender in market, after HSBC announced it would be withdrawing from Australia. Its $36 billion book of home and personal loans will be offloaded to private equity firm Blackstone, while the loans will be serviced by non-bank lender Pepper Money.<\/p>\n MORE: Billy Slater\u2019s wild new life after footy<\/a><\/p>\n The market is looking a little less fertile for lenders all of a sudden.<\/p>\n Recent quarterly lending data from the Australian Bureau of Statistics revealed a 5.4 per cent drop in the total number of new home loans, driven largely by a decline in lending to investors.<\/p>\n The release came on the back of a 28 per cent fall in investor loans announced by Commonwealth Bank and a 26 per cent fall reported by Westpac.<\/p>\n With less interest money to go around between all the lenders we still have, is it time to worry about more banks getting out of the market? And suddenly, with home values now falling, faster than many thought and with no floor in sight just yet, neither houses nor banks seem as safe as they used to be.<\/p>\n The bank of mum and dad is likely helping young buyers avoid negative equity.<\/p>\n Canstar data insights director Sally Tindall said the current environment was \u201cputting pressure on lenders big and small\u201d, but noted that there was currently little cause for concern from regulator APRA. She said that when the lending market gets tough in Australia, buyers are presented with more opportunity to save money.<\/p>\n<\/p>\n
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