ME bank came out yesterday as the second non major to announce a reduction of the assessment rate:

“From Friday 2 August 2019 there are some changes to ME’s Home Loan Serviceability Rates you should know about.

ME will be decreasing the floor rate to 5.25% p.a. and increasing the buffer rate to 2.50% p.a. for all home loan applications.”

This will be a new game again (or a change back to the old game…).

And that is not me being dramatic, the new rules around servicing (an assessment rate reduction of 2%) make a real difference. Affordability has improved by 15% or more. And combined with the low interest rate environment we are currently in and watch what the property market will do.