Joye: Housing enjoying “benign correction”

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From our Chris today:

In the scheme of things, this is a benign correction…In February the national clearance rate averaged 65 per cent, which compares to the 74 per cent mark in February 2017. Importantly, this is still miles above the 50 per cent threshold that normally signals real market weakness of the kind documented in 2011 and 2012.

In the short-term there may be new tail-winds. First, the regulator is going to remove the current 10 per cent annual speed limit on investment home loan growth. Second, after aggressively raising rates on interest-only loans to reduce their share of new approvals, banks are cutting them again.

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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.