admin-ajax.php

Real Estate Agents Throw Weight Behind Australian Bank Reforms

With the lack of competition in the banking sector making it harder for home buyers and property investors the Real Estate Institute of Australia (REIA)  has thrown its weight behind bank reform, calling for credit unions and building societies to be considered the “fifth pillar” in the banking system.

A Senate committee is inquiring into competition in the banking sector, following criticism that the big four banks are strangling competition for home borrowers and businesses.

The Real Estate Institute of Australia (REIA) said in its written submission to the inquiry that the “market concentration trend” is impacting on home buyers and small businesses.“REIA believes that ways of improving competition in the financial sector need to be vigorously assessed including the possibility of a new pillar in the banking system based on the mutual sector – credit unions and building societies,” the submission said.

The peak body said the proportion of weekly family income needed to meet home loan repayments had risen from 25.5 per cent in March 2000 to 34.6 per cent in June 2010, as interest rates rose and housing affordability continued to fall.

“With a direct link between interest rates and housing affordability, it is important that any changes in retail interest rates are justifiable and are kept to a level that can be accounted for by changes in the banks’ borrowing costs,” the REIA said.

Measures were also needed to address small businesses’ access to finance.

Over the past two years, banks had penalised small businesses by denying access to credit, reassessing already agreed loans, imposing unfair risk assessments and making credit cards too costly.

“REIA believes that measures to stop the penalising of small business finance costs need to be put in place,” the submission said.

Of course like most things related to government, this is all going to take time. The inquiry is due to report by March 31. Then we’ll see if anything happens.



icon-podcast-large

SUBSCRIBE & DON'T MISS A SINGLE EPISODE OF MICHAEL YARDNEY'S PODCAST

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

icon-email-large

PREFER TO SUBSCRIBE VIA EMAIL?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.


Avatar for Property Update

About

Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


'Real Estate Agents Throw Weight Behind Australian Bank Reforms' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.
CAPTCHA Image

*

facebook
twitter
google
0
linkedin
0
email

Michael's Daily Insights

Join Michael Yardney's inner circle of daily subscribers.

NOTE: this daily service is a different subscription to our weekly newsletter so...

REGISTER NOW

Subscribe!