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last mo.

Coalition Pledges to Ease Lending Rules in Push for Housing Affordability

Ahead of the May election, the Coalition promises to lower the serviceability buffer and revise APRA's mandate, despite warnings from regulators about financial risks.

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The Opposition wants to relax lending rules, saying young people are being "locked" out of home ownership. But the prime minister says the plan is "hard to work out".
A home buyer looks at documents. In the foreground of the image is a model house and keys.

Overview

  • The Coalition has made housing affordability a key election issue, proposing to relax home lending rules if elected on May 3, 2025.
  • The party plans to lower the serviceability buffer from 3%, which it claims currently blocks nearly 40% of first-time buyers from securing loans.
  • Proposals include revising APRA's mandate to prioritize borrowers' needs over limiting risky loans, a move supported by major banks and property groups.
  • APRA has expressed concerns, citing high household debt as a significant vulnerability and urging caution against relaxing the buffer.
  • The Coalition also aims to reduce borrowing costs for those without family financial support by changing how loans backed by Lenders Mortgage Insurance are treated.