The repercussions of the royal banking commission should slow the growth of real estate loans

Changes in consumer behavior and interest may take longer to adapt to regulatory changes, but they will inevitably slow market growth, senior lenders and brokers say Australian mortgages at Deloitte.

Deloitte claims that lenders are already responding to the Commission's request and to other banking investigations and are improving many of their processes.

"The Challenges of Conduct, Compliance and Distribution Will Continue in 2018, and the advent of the Open Data Regime promises to become a more" consumer-in-control "future, says James Hickey, President Deloitte Australian Mortgage Report Roundtable

Deloitte Financial Services Partner Heather Baister says some of the comments and questions that come out of the Royal Commission are areas where action is already being taken.

The Industry Forum of Banks, Broker Groups and Consumer Representatives is already exploring ways to solve the problems of transparency, distribution oversight and accountability in mortgage lending

. "There are all the reasons why market providers should be cautious given the increased uncertainty around the upcoming regulatory landscape," said ASIC, responsible for prudential regulation. said Baister.

"Maybe the ASIC will come back with sharper teeth?"

"Although there are already laws in place to handle driving, I'm waiting to see a greater obligation for lenders beyond the current legislative hurdle "should not be inadequate." "In the future, lenders will have to how they can demonstrate that the client has a real understanding of their This means a more in-depth evaluation process, tailored to individual clients and their understanding of the loan, which will inevitably slow down market growth. "

Australia's leading mortgage lenders and brokers predict that housing construction volumes will remain stable or likely decrease by 5% from the peaks of previous years.

Deloitte says that this will give first-time homebuyers and homeowners a chance to stay home from home. get more traction.

The mortgage market has stabilized after three strong years, as this chart shows:

This year will be the second consecutive year since 2012 that the level of new mortgages is flattening or decreasing .

However, the director of Deloitte Access Economics, Michael Thomas, says that the residential market generally continues to be supported by other fundamentals.

"Underlying demand remains strong with strong but uneven population growth, which is expected to continue through 2020. Employment growth has also been strong, especially in Victoria", he says

. varies across the state. For NSW and Victoria, growth in housing construction has slowed from its peaks but remains at high levels and is supported by strong underlying demand.

"Taken together with interest rate outlook, slowing housing price growth, moderating capital gains outlook, restrictions on lending, such as interest-rate loans and investor loans as well as on loans to foreign investors, we are waiting for a period of moderation, rather than a steep adjustment. "

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