The restriction of access to investment loans has prompted many Australian investors to consider other options, according to a new study by the Property Investment Professionals of Australia.
About three in five real estate investors are now likely to consider a non-major bank due to difficulties in obtaining investment financing and the conclusion of the Royal Banking Commission, said PIPA's President , Peter Koulizos.
Read also: Are non-banks the solution for investors?
In fact, more than one in four investors had already secured a loan from non-significant lenders in the last year. The most cited reasons were lower interest rates and higher borrowing power.
About 27% of investors indicated that they would consider refinancing their loan for a lower interest rate of 50 basis points.
"Given the tightening of credit conditions and the reaction of the financial sector to the Royal Bank Inquiry Commission, 25% of those surveyed said they were unable to refinance an amount that was They had been able to borrow before, "Koulizos said.
He said that the struggle to access credit could be one of the reasons why the number of investors has declined significantly in recent years.
The long-term goal of the investor
The study also revealed that real estate investors are now more focused on the long-term benefits of real estate. About three in four said worries about falling prices would not make them put their investment plans on the backburner.
The majority of investors claimed that the current environment made it ideal for investing in residential real estate.
"Long-term capital growth outweighs cash flow – both long-term and short-term – as the most important aspect when choosing a company. investment, "said Koulizos.
The study also indicates that the motivation of potential investors is not to "get rich" but to provide a better life for themselves and their families.
tweed is heading south
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