The Reserve Bank of Australia has acknowledged many first homebuyers have been locked out of an ‘expensive’ housing market but says it is in no position to help.
Speaking before the federal inquiry into home ownership, the RBA’s head of financial stability Luci Ellis said while the central bank was concerned about investors snapping up properties, the bank’s priority was to protect the financial system and strengthen lending rules in a risky environment.
Ms Ellis conceded that cashed-up investors with better equity and borrowing capacity had squeezed some first homebuyers out of property markets in the capital cities.
“At the margin this has probably priced some aspiring first homebuyers from properties they could otherwise acquire,” she said.
“Nonetheless, while there has been much debate on this issue, from a financial stability point of view it is helpful that there has been no push to improve the position of first homebuyers by easing lending standards.”
Ms Ellis said the RBA believed there was too much risk involved with relaxing lending rules or tinkering with negative gearing.