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Brokers are still digesting the November announcement that ANZ had cut its maximum LVR from 95 to 90 per cent, as concern mounts over the implications for the industry.
An ANZ spokesperson said the move was in response to weaker economic conditions forecast for 2009.
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The wobbling economy, international financial pressures and the softening of the property market has already led some lenders to tighten their criteria on 100 per cent products.
CBA is one of the latest to act, removing its 100 per cent products altogether and capping its LVR at 95 per cent.
Westpac, NAB and St George continue to offer 100 per cent LVR loans, but a NAB spokesperson told Mortgage Business its high LVR lending criteria was under review.
A St George spokesperson said the bank’s products were constantly under review, but it had “no announcements at this time”.
There are industry fears the ANZ LVR reduction could further damage an already fragile housing market.
Mark Hewitt, AFG general manager of sales and operations, said his initial reaction was one of concern.
“Those loans of greater than 90 per cent LVR are typically first home buyers, so such changes could virtually evaporate the government’s first home buyer incentives immediately,” he said.
Mr Hewitt said without a recovery in the first home buyer market there were potentially negative ramifications for other market segments.
