The mid-winter moves by the Reserve Bank and the banks to try to cool down the housing market appear to be having some effect, at least for now. Real Estate Institute figures for August showed a slight flattening in volumes and prices across the country as the Reserve Bank’s mid-July announcement of a further tightening of Loan to Value Ratio restrictions took effect. The banks have also taken some heat out of the demand from rental property investors in particular by refusing to pass on all of the August 10 cut in the Official Cash Rate. Some banks, including the ANZ, have also warned that the housing market is becoming over-heated and have tightened their lending criteria even more than the Reserve Bank required.
