Mirvac unfazed by halt to foreign lending

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The chief executive of real estate group Mirvac believes the company will maintain strong settlement rates on apartment sales despite the major banks’ new restrictions on lending to foreign buyers.

Susan Lloyd-Hurwitz was responding to Westpac's announcement that it will stop lending to foreign residential property buyers, the latest major bank to take such a measure.

Lloyd-Hurwitz told Australian Financial Review, “We're yet to see the impact that will have on financing but we work closely with a lot of our purchasers and they get a lot of notice from us as to when they're going to need the money.”

Sale to foreign buyers are thought to make up 20-30% of Mirvac’s total sales. However, some of these buyers use cash while others use global banks or their own lenders. Foreign buyers looking to borrow in Australia, in order to build a credit profile, is a relatively new phenomenon.

"I'm not denying if there is no financing from Australian banks for foreign buyers it wouldn't change customer behaviour," Lloyd-Hurwitz said.

"We'd have to work harder with them to go back to where we were a few years ago when they weren't relying on domestic financing."

She added, "We haven't seen any systemic difficulties in getting capital out of China, we haven't seen any problem with valuations. It's absolutely business as usual."

The one major bank that hasn’t announced a halt to lending to foreigners, NAB, has said it will continue to review foreign loan applications on a case-by-case basis.

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