Property lobby backs national sub-prime first home buyer scheme

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In MB’s half-year special report, we noted the following:

Australia’s authorities have moved swiftly to stimulate the market. Moreover, we believe that further policy stimulus is coming down the pipe. The RBA will cut all the way to a 50bps cash rate. APRA may also add more stimulus.

For example, Western Australia’s Housing Minister, Peter Tinley, has been liaising with the Morrison Government on a nation-wide roll-out of Western Australia’s Keystart low-deposit loan scheme, which allows eligible buyers to purchase a home with minimal deposit and without needing lender’s mortgage insurance. Basically, it is a government-backed sub-prime loans scheme designed to suck marginal borrowers into the market.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.