Westpac's mortgage pipeline just fell off a cliff

Home loan applications at Westpac dropped from roughly 33,000 a month to about 27,000 after Australia's federal budget floated changes to negative gearing and capital gains tax, a 20% fall that Reuters confirmed from the bank's own disclosures. Investor housing credit growth is now expected to halve next year. The stock fell 2.57% to A$34.50, pushing Westpac into bear market territory and down 11.42% year to date, and Citi has already cut profit forecasts across the big four banks on the same read-through. Consumer banking head Carolyn McCann blamed rates, policy uncertainty and the tax proposals together, not any single factor, which is the more worrying version of this story for shareholders because it means there's no single lever to fix.