 House prices in Australia
Australian house prices have declined by around four per cent since peaking in March 2008, compared with falls of around 10 to 25 per cent in the US and almost 20 per cent in the United Kingdom, the Reserve Bank of Australia said on Thursday in its Financial Stability Review.
Increased interest from from home buyers has softened the fall in house prices. Since the boost to the first home owner grant was announced in October last year, real estate agents and mortgage brokers have reported a sharp increase in the number of inquiries from first home buyers.
"The first home buyers grant has underpinned housing values," Mr Lindsay told AAP after his company reported its first-half earnings on Thursday.
"The first home buyers are sucking up anything they can.
"There's no way we'll have the problems they had in the US caused by the falling property values."
The RBA is confident Australia will not see major falls in property values, as seen in the US. It does concede some falls may occur however.
The grant for first time buyers was increased to $14,000 for those buying an established home and to $21,000 for those building or buying a newly constructed home. This increase is only until June 30 when the grant reverts back to $7,000. Recently interest rates have also fallen by almost 4 percentage points, making housing more affordable for first home buyers.
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