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By: Belinda Luc
Real Estate Institute of Australia (REIA) president David Airey has slammed the federal government’s treatment of competition in the financial market.
During a meeting with the Federal Housing Minister Tanya Plibersek, Mr Airey voiced his concern about the lack of competition, with the big four now accounting for over 80 per cent of the home lending market.
“This has severely depleted competition and funding for smaller banks such as Bendigo Adelaide and Bank of Qld, as well as other non-bank lenders who suffer a huge disadvantage with funding costs,” Mr Airey said.
According to Mr Airey, major banks are “continually moving the goal posts” with long delays in loan approvals, tightening of credit, lowered Loan to Valuation Ratio’s (LVR’s) and changed credit assessment criteria, preventing or delaying loan approvals.
“Restricted and changing lending practices by the big banks have worked against the government’s aim to increase housing supply in Australia.
“This is exacerbated by planning delays, restrictions and costs at the local government level,” he said
REIA has formally submitted its concerns to the government in the form of a Pre-Budget Submission, including the indexation of the First Home Owner’s Grant to median house prices.
