The looming home loan risk keeping property experts up at night
The share of risky lending has dropped in recent months, new figures show, after rising interest rates made it harder to borrow large sums relative to incomes.
But concerns loom for the recent home buyers who borrowed at rock-bottom fixed interest rates and will face higher mortgage repayments when they refinance next year.
During the property boom, almost a quarter of new home borrowers were taking on large debts of six times their incomes or more.
The share of new lending at high debt-to-income ratios has fallen 7.2 percentage points from its peak in the December quarter of last year, to 17.1 per cent in the September quarter of 2022, figures from bank regulator the Australian Prudential Regulation Authority show.
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