November 04, 2014
Mortgage Choice chief executive officer Michael Russell has called upon regulators to put to bed any notion of macro-prudential intervention to cool the housing market, citing the latest slowdown in dwelling values as evidence the market is itself recalibrating.
Mr Russell said there was no need for any regulatory interference to curb the demand for investment lending, given the unintended consequences on economic growth and unemployment would be dire, particularly in those states and territories outside of Melbourne and Sydney.
“While RP data found that dwelling values were up 1% last month, the annual growth rate over the 12 months to October has now slowed to 8.9% from an earlier peak of 11.5% in April of this year.
“The diverse performance of our housing market was again on show last month with only Brisbane, Melbourne and Sydney recording positive growth.
“On a quarterly basis, dwelling prices are up 2.2% to October, with only four states and territories recording positive growth, highlighting again why any broad based intervention would be totally inappropriate” Mr Russell said.
“As I have touched on recently, any regulatory interference to cool down dwelling price growth is short-sighted and could well have a devastating impact on the states and territories outside of Melbourne and Sydney where dwelling price growth can hardly resemble a bubble.”
“The problem is one of supply – supply of affordable housing.
“Like most participants in this industry, we are acutely aware of the time delays and costs associated in bringing affordable housing to market and believe this is an inflationary element that can be curtailed if the powers to be seriously wish to tackle it.”
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