CBA unveils its pump and hike strategy

Advertisement

From CBA CEO Ian Narev via the AFR:

With the Reserve Bank of Australia previously branding the current investor-led surge in house prices “unbalanced” and governor Glenn Stevens describing Sydney’s market as “crazy”, Mr Narev said actions from the Australian Prudential Regulation Authority to cap the lending growth to housing investors would in the short term have a moderating effect on immediate investor demand, but the popularity of Sydney and Melbourne as places to live combined with limited supply suggested prices have further to run over the longer term.

“On the one hand, if you look year on year, the run-up in property prices in [parts of Sydney and Melbourne] feels like it’s going to have to come off. But on the other hand, when you again look back on these fundamental forces of supply of demand, some of them might be around for quite some period of time yet,” Mr Narev said in an interview.

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.