Home Loan Limit Necessary

Bob Gregory, a former board member of the Reserve Bank of Australia (RBA) and Ross Garnaut, a Melbourne University professor and economist, have told financial regulators that they need to pull in lending into order to avoid what some call a ‘housing bubble’.
The RBA’s minutes from their last meeting were also rife with board members’ concern regarding the property market, particularly for investors. This has been exacerbated by the rise in the number of investors using a self-managed superannuation fund (SMSF) to buy a property.
According to the Australian Financial Review, the central bank regulator is planning on increasing its vigilance of the lending standards by which banks are currently operating.
Property analyst for SQM Research Louis Christopher recently predicted that the national housing prices could increase by up to 18% within the next year if the economy continued to strengthen.
This could place the RBA into an undesirable position, particularly if the economy has not yet recovered to achieve average growth.
Source: http://www.afr.com/p/national/economy/momentum_builds_for_home_loan_limits_0pOasL2qGiKlMIkr1B5OrL

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