One agency has felt the full force of the investor crackdown, as new statistics have revealed a significant decline in investor activity.
The prudential banking regulator, APRA, reported that the annualised rate of investor lending growth slowed from 11.5 per cent in July to 9.9 per cent in August – a drop of 14 per cent.
Raine & Horne Charmhaven principal Andrew Sorensen said the investor crackdown has had such an effect that his open home traffic has fallen 70 per cent over the past six weeks.
“The main buyer group which has left has been the investors. They’re still around, but now they’re looking for very particular properties,” Mr Sorensen told REB.
“They’re not looking at any speculative buying now, and definitely not buying and hoping for capital gain.”
Mr Sorensen said the investor crackdown has also affected the property management business of the 19-person agency, which is located 110 kilometres north of Sydney.
“We were averaging between 17 and 25 new investment properties into our business to manage each month. We were doing that for 12 months solidly. [In September], we were down at 11,” he said.
“We haven’t lost them to other agents – that’s just how much it’s dropped.”
However, Paul Caine from Caine Real Estate has had a different experience, with his Melbourne agency noticing only a small decline in investors through its open homes.
“The investor has become a little bit more careful about where they spend their money,” he said.
“They’re still spending but they’re spending not so much on off-the-plan stock, as established stock in quality buildings and quality suburbs.”
CoreLogic RP Data senior research analyst Cameron Kusher told REB that the investor crackdown had been taking marginal borrowers out of the market.
“Overall, I don’t think it’s going to have a huge impact, but certainly it might make some new developments a little bit harder to get out of the grand because pre-sales would be a little bit harder,” he said.
“It’s most likely to impact on brand-new projects in Sydney and Melbourne, and to a lesser degree Brisbane, but good-quality projects will still get enough demand.”