Assistant Treasurer Josh Frydenberg bursts real estate bubble speculation, davey real estate.#Davey #real #estate

By | 12/06/2018

Assistant Treasurer Josh Frydenberg bursts real estate bubble speculation

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Davey real estate Nuclear options: Resources Minister Josh Frydenberg. Photo: Sean Davey

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When asked about Mr Fraser’s comments on Sunday, Mr Frydenberg said he did not agree.

“I don’t think there is a housing bubble,” he told the ABC’s Insiders program.

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Davey real estate There are fears property bubbles are forming in Sydney and Melbourne.

“Housing prices have gone up, but it went up higher in the early 2000s.”

Mr Frydenberg, who holds the inner Melbourne seat of Kooyong, said regulators like the Reserve Bank were keeping an eye on housing price growth.

“At the same time, we have seen strong housing prices before,” he said.

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“In the early 2000s, housing prices increased by 20 per cent for three years in a row and then were steady for a decade. And there wasn’t a bubble that led to a major correction.”

Mr Frydenberg’s comments sit in stark contrast to his departmental secretary, Mr Fraser’s. During Senate estimates last week, Mr Fraser spoke of his concern about low interest rates and the housing bubble.

“When you look at the housing price bubble evidence, it’s unequivocally the case in Sydney, unequivocal,” Mr Fraser said.

“It does worry me that the historically low level of interest rates are encouraging people to perhaps over-invest in housing.”

Reserve Bank assistant governor Malcolm Edey​ also told senators: “I know that a lot of people do think it’s a bubble.

In the early 2000s, housing prices increased by 20 per cent for three years in a row and then were steady for a decade.

Assistant Treasurer Josh Frydenberg

“Serious people think that. And we agree that this is a situation where the market is strong, it’s over-heated, it’s a risky situation. Some people call that a bubble.”

The average NSW home price today costs about five times the average NSW household income, according to Barclays Bank analysis.

On Sunday, Mr Frydenberg said the increases in house prices were due to a “number of things”.

“It’s a function of population growth, it’s a function of state governments not engaged in enough land release. It’s a function also of foreign investment.”

When asked by Labor leader Bill Shorten about Mr Fraser’s comments, Mr Abbott said housing affordability was important but home owners like him would prefer to see house prices continue to rise.

“As someone who, along with the bank, owns a house in Sydney I do hope our housing prices are increasing,” Mr Abbott said in question time on Monday.

“I want housing to be affordable but nevertheless, I also want house prices to be modestly increasing.”

Mr Shorten responded that Mr Abbott was out of touch.

Negative gearing plan

The Greens are proposing that negative gearing – which allows investors to use losses made on property to reduce their taxable income – be scrapped for new residential investments.

Critics say negative gearing inflates house prices and locks people out of the market.

The Abbott government has previously ruled out any changes to negative gearing, although Labor has suggested there is some room for reform.

On Sunday, Labor frontbencher Anthony Albanese cautioned that negative gearing was just one element when it came to housing affordability.

He added that a lot of investors in housing were “mums and dads”.

“It’s not just the big end of town.”

– with Adam Gartrell, Gareth Hutchens and Matthew Knott

Davey real estate

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