Curb on loans hard on investors
Thousands of mum and dad investors could lose money through finance company failures if mooted Reserve Bank curbs on mortgage lending succeeded in cooling the housing market, a leading fund manager said yesterday.
Tuesday, November 15th 2005, 12:35AM
by The Landlord
The Reserve Bank said this week it was reviewing a range of options to limit lending to house buyers.The moves were being considered because a succession of official interest rate rises had failed to tame the booming housing market and rising inflation.
The options have been almost universally panned by banks and others in the finance industry for smacking of old-fashioned interventionism and because they may have unintended consequences.
Tower Financial Management chief executive Tony Hildyard, who has already warned about the risk to investors in finance companies lending to property developers, said there could be trouble for those companies if the Reserve Bank's moves succeeded in crimping property prices.
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