Regulators should “put to bed” any notion of intervening to cool the housing market and slowing investor activity, according to Mortgage Choice CEO Michael Russell.
Mr Russell said any regulatory interference aimed at curbing the demand for investment lending would have “dire”, unintended consequences on economic growth and unemployment.
Mr Russell also cited the latest slowdown in dwelling values as evidence that the market is recalibrating without interference.
“While RP Data found that dwelling values were up one per cent last month, the annual growth rate over the 12 months to October has now slowed to 8.9 per cent from an earlier peak of 11.5 per cent in April of this year,” he said.
“The diverse performance of our housing market was again on show last month with only Brisbane, Melbourne and Sydney recording positive growth, highlighting again why any broad-based intervention would be totally inappropriate.
“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 swelling price growth can hardly resemble a bubble.”
Mr Russell echoed the sentiment of other commentators, such as Century 21 Australasia’s owner and managing director Charles Tarbey, and said “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 that be seriously wish to tackle it,” he said.
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