RBA's Kent speaks on housing debt and risks

Reserve Bank of Australia's Christopher Kent, Assistant Governor for Financial Markets, has been speaking at the Moody's Conference in Australia, on the subject of housing debt and risks. The main hadlines can found below.


Says there is a large share of both owner-occupier and investor loans with current loan-to-valuation ratios between 75 and 80%

Investors have a larger share of outstanding loans with current LVRs of 75% or higher

For both investor and owner-occupier loans, adjusting for offset balances leads to only a small change in the share of loans with current LVRs greater than 80%

This suggests that borrowers with high current LVRs have limited repayment buffers

Banks' non-performing housing loans have increased a little over recent years; however, at around 3/4 of 1% as a share of all housing loans, non-performing loans remain low and below the levels reached following the global financial crisis

Arrears have risen more in regions experiencing weak economic conditions over recent years

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