Aussie Home Loans boss John Symond has dismissed concerns of a property bubble building in Australia and says the housing market has reached 6.30 on the property clock and is on the road to recovery.
Speaking at an Australia-Israel Chamber of Commerce function in Brisbane this week, Symond slammed the monetary policy decisions of the Reserve Bank, accusing the current board, led by RBA governor Glenn Stevens, of being “asleep at the wheel”.
“I am confident, notwithstanding a lot of hype from offshore analysts about a housing bubble, of Australia’s fundamentals,” Symond said in a speech reported by the Australian Financial Review.
Over the past few weeks newly appointed chairman of Swiss bank UBS Axel Weber has warned that Australia risked a future property bubble collapse while Patrick Winsbury, senior vice-president of Moody’s, has also expressed concerns about the effect lower interest rates could have on Australian property prices.
However, senior Australian figures have also warned of the risk of a housing bubble. They include Barry Brakey, head of property at the sovereign Future Fund, who said the overvaluing of Australian property was holding the fund back from investing more in Australia. Australian ANZ boss Phil Chronican also told Fairfax radio station 3AW that one had to worry “when there is a lot of cheap money around that results in asset price inflation”.
Earlier this week RBA deputy governor Philip Lowe told a Finsia seminar in Hobart that while the bank was not overly worried about relatively low interest rates reigniting a housing boom because household appetite for debt is relatively low, it would “continue to monitor the housing market closely”.
But Symond dismisses the threat of a housing bubble and says interest rates are too high.
He believes the housing market is a healthy state and the housing market has bottomed out.
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