on air now

Treasurer urging banks to provide credit to home buyers to avoid economic slowdown

The Federal Treasurer is urging banks to reverse their recent reluctance to lend to would-be home buyers.

The latest housing data shows national house prices dropped 4.8 per cent in 2018, marking the biggest drop since the Global Financial Crisis.

Four of the nation’s eight capital cities recorded a decline in dwelling values, with Sydney falling the hardest by 8.9 per cent, followed by Melbourne who saw a 7 per cent drop.

Treasurer Josh Frydenberg tells John Stanley it’s a “correction of the housing prices”.

“But what we don’t want to see is policies introduced that will drive prices down further and then impact upon the real economy.

“That’s why we’ve been very critical of Labor’s plans to abolish negative gearing as we know it.”

The Treasurer says it’s also important banks continue to provide affordable and timely access to credit.

“We’ve seen housing credit from the banks slow to well below the 10-year average.”

He says it’s a result of a number of factors.

“A bit more risk aversion following the royal commission, there’s also been some tightening in the lending standard.”

Click PLAY below to hear the full interview