ANZ chief goes on the offensive

By |

Australia isn’t going through a housing bubble, says ANZ chief executive Phil Chronican, but state and federal governments aren’t doing enough to address serious housing issues.

Speaking at the American Chamber of Commerce lunch in Sydney, Chronican said that a shortage of land release was contributing to making Australia one of the world’s most expensive countries for real estate.

Comparing Australian property prices with those of land-starved Hong Kong and Singapore, Chronican believes that short-term government policies, such as the first homebuyer stimulus, are increasing demand and pushing prices further north.

"We need to refrain from pursuing short-term policies that add to demand-side pressures,” he said. "If we really want to help people into homes, we need to address the supply-side issues, not add to the demand that drives prices up.”

"We have seen what can happen when [governments] get it wrong in the case of the first-home owner's grant. These grants were capitalised against house prices so quickly they didn't so much benefit first-home buyers,” he added. “It was the first-home seller's grant really."

He went on to suggest that the thorny issue of negative gearing was also a key driver of unaffordability in the Australian housing market, and recommended that now may be the time for the government to look at reining in the tax break.

''Governments might want to look at whether the current extent of negative gearing tax breaks are fostering an unhealthy focus on housing as an investment vehicle, thereby compounding affordability issues,'' he said.

Are investors being turned into the housing market’s scapegoats? Is negative gearing really detrimental to the health of Australia’s property market? Join the debate at

Can you afford to buy in this suburb? Find out how much you can borrow

Top Suburbs : whyalla , new farm , revesby hts , werribee , rockville

go back

Get help financing your investment

Do you need help finding the right loan for your investment?

When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.

Just fill in a few details below and we'll then arrange for a local expert Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus, our mortgage broking service is at no cost to you.

How soon would you like a mortgage?
What is your Annual Household Income i $
Do you currently own any Investment Properties?
Do you own your own residence?
How much equity do you have in all your current properties?
First Name
Last Name
Where do you live?
What number can we reach you on?
E-mail address
We value your privacy and treat all your information seriously - you can check out our privacy policy here