Banks fear no crackdown!  Why would they with NO Enforcement of Law.  Toxic Lending surges ahead.  No self-respecting Consumer trusts Swiss UBS!!!

More Propaganda from Banksters:

Fears of crackdown as investor lending surges

The Australian 12:00am January 26, 2017

Michael Bennet

Lending to property investors is nearing the lofty levels that spurred the regulator to rein in the banks, raising the possibility of a fresh crackdown amid worries the market is overheating again.

“Over the last few months we have seen a re-acceleration in investment property lending flow,” UBS banking analyst Jonathan Mott told clients yesterday.

“Fundamentally we see this as very concerning, given the lack of value for investors in the housing market, reliance on tax breaks (negative gearing) and expectation of ongoing capital gains for the numbers to stack up.”

He forecast $78 billion of housing investor housing finance in the banks’ fiscal first halves, compared with $73bn in the back end of 2014 and $82bn in the first half of 2015.

The Australian Prudential Regulation Authority in December 2014 told banks to limit annual investor lending to 10 per cent after credit growth rose to double-digit rates.

While agreeing with peers that the outlook for the major banks had slightly improved in recent months, Mr Mott said the pick-up in lending to investors was a “catch 22”. It was typically deemed riskier and the banks were already facing the headwind of a “26-year boom (that) has led to significant household leverage and inflated housing prices”.

But in the near term, stronger lending to landlords will ease the slowdown in overall demand for credit, prompting UBS to increase its forecast for housing credit growth to 5.4 per cent for the year to September, up from 5 per cent.

“However, despite the pick-up in investment property lending flow, we still expect a steady slowdown in housing credit growth over the next two years,” Mr Mott said.

“For housing credit growth to remain steady at around 6.5 per cent, new housing lending flow would need to grow by around $330bn in full-year 2017 and $355bn in 2018.

“While possible, we believe such ongoing growth in housing lending (and investment property lending) would likely be met with further regulatory restraints.”

System investor lending growth bottomed at 4.6 per cent in August, but has since expanded every month, according to the Reserve Bank.

Amid intensifying political debate about poor housing affordability, Digital Finance Analytics analyst Martin North said ultra-low interest rates were stimulating too much demand from investors, who also were assisted by tax concessions.

“For many, property has ceased to be primarily a place to live; it is rather an investment first and foremost. This is a concerning trend,” he said.

Economists warned yesterday’s soft inflation data for the December quarter would reduce the chances of the RBA hiking the cash rate later this year. Some brokers, such as JPMorgan, still expect two rate cuts.

Mr North said regulators should bring in new macro-prudential policies, particularly debt to income servicing ratios, and subject foreign buyers to tighter oversight.

Deutsche Bank analyst Andrew Triggs said two key long-term risks for the banks were that rapid house price growth raised the potential for losses in their mortgage books and housing lending slowed. “We expect the bank sector to offer better prospects in 2017 … (But) we do see a number of challenges which the sector will encounter.”