New RBA head worried by housing affordability
New Reserve Bank governor Phillip Lowe has expressed concern over the high cost of housing.
In his first appearance before the House of Representatives Standing Committee on Economics, Lowe said he was worried about the ability of young Australians to access the property market, the Australian has reported.
“As a father of three children I worry … because people are paying so much for housing,” Lowe said.
Lowe argued that housing affordability could be aided by investment in infrastructure that made outer suburbs more accessible, the Australian said.
“We can do something about that through zoning and transportation. We haven’t invested enough in transport,” he said.
Lowe also conceded that the RBA’s rate cuts were becoming less effective at stimulating the economy.
“You can keep doing more of something in the hope that it finally works, and my judgment is that that has not been particularly useful,” Lowe said.
Instead, Lowe said the government could do more to encourage private sector infrastructure spending.
“The private sector has a huge demand for infrastructure assets that earn reasonable rates of return. So the government can be a facilitator to allow the private sector to use its balance sheet and the low interest rates to undertake infrastructure investment.”
Lowe also unveiled plans for new designs for $10 and $50 notes.