Regulators may have to pump brakes on housing
Regulators may have to take action if the property market doesn’t cool soon, a researcher has claimed.
Following a strong weekend for auctions across the country, SQM Research managing director Louis Christopher has told the Australian Financial Review that the Reserve Bank and the Australian Prudential Regulation Authority (APRA) will need to step in if auction clearance rates remain high.
According to the AFR, Sydney’s auction clearance rate hit 84.4% on the weekend, while 79.1% of auctions in Melbourne cleared. Christopher said this was in spite of a lower volume of properties coming to market, potentially putting more pressure on property prices. While clearance rates have remained higher than the same time last year, auction volumes for the first four weeks of spring were 20% lower.
"It's creating angst among buyers, particularly those ones who bought in July or August and they are really caught out right now. I think volumes could still rise in October, but to be clear, there will be less volume overall,” Christopher told the paper.
Christopher predicted that the RBA might “lean on” APRA to clamp down on home lending.
"It is now less to do with credit growth and more to do with the NSW economy going gangbusters, and firm rises in population in both Sydney and Melbourne," Christopher said.