Property investment peak body calls for balanced approach to create a more sustainable market
The Property Investment Professionals of Australia (PIPA) has questioned the move by lenders to increase interest rates to both new and existing property investors, urging regulators and government to take a more balanced approach in working to encourage a sustainable and flourishing property market.
PIPA Chair Ben Kingsley said increasing interest rates for existing investors appeared to be an opportunistic move by banks that could have potentially harmful flow-on effects to the broader property market.
“Increasing borrowing costs for investors, and in some cases owner occupiers, who bought into the market some time ago seems unfair and detracts from what should be the common goal of creating a balanced property market,” Mr Kingsley said.
PIPA believes more targeted measures to slow new investor lending, such as decreasing and restricting borrowing power for new investors in locations where the market was particularly heated, could be a better approach.
“Above all, the industry needs to be united in slowing investor activity in some markets. While PIPA fully supports responsible lending, we believe going forward APRA should take a more transparent approach, rather than continue its current closed door tactics.”
According to Mr Kingsley, APRA’s pressure tactics to force individual lenders to lock out investors, or increase interest rates, have raised both concerns and question marks for the industry.
“While real estate can absolutely be a powerful investment class, people must recognise that not every property in every market will deliver appropriate returns, and in a heated market, the odds are really against you.
“PIPA is urging the government and regulators to join forces and open this debate to the broader industry. Let us all contribute to this discussion and invest in measures that will create a more balanced property market for the long-term, and strengthen this invaluable component of our economy,” he said.
As the peak body for the property investment industry, PIPA has long campaigned for greater education around property investment as well as regulation of property investment advice.
“PIPA remains dedicated to supporting a healthy, sustainable property investment industry, where education and appropriate regulation come together to support good outcomes for all stakeholders involved,” Mr Kingsley concluded.
NOTE TO EDITORS
The Property Investment Professionals of Australia (PIPA) is a not-for-profit association established by industry practitioners with the objective of representing and raising the professional standards of all operators involved with property investment.
Since its inception, PIPA has developed codes of ethics and conduct and professional standards of accreditation and education for the property investment industry, including a Property Investment Adviser Accreditation Course.
PIPA is actively lobbying the federal government to bring property investment advice into a regulatory framework. Until such regulation is introduced, PIPA will continue to provide the public with warnings about working with ethical and professional industry practitioners.
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