"I"m not just [talking] about buying housing, but I'm talking about investing in housing."
Expert insights Investing Sydney's unequivocal housing bubble: Commonwealth Treasury secretary John Fraser
Sydney's unequivocal housing bubble: Commonwealth Treasury secretary John Fraser
Jonathan ChancellorDecember 7, 2020
John Fraser, the Commonwealth Treasury secretary, says Sydney was in a housing bubble.
The senate hearing this morning, reported by the ABC, noted he said that there is no doubt in his mind there is a Sydney housing price bubble.
"When you look at the housing price bubble evidence, it's unequivocally the case in Sydney. Unequivocally," he said.
"Frankly, whatever the data says, just casual observation can tell you it's the case."
The latest CoreLogic RP Data statistics actually show that home prices went backwards last month, everywhere except Darwin and Canberra.
John Fraser, who sits on the Reserve Bank of Australia board, advised there was little sign of a housing bubble outside Sydney and the higher-priced end of the Melbourne market.
But he expressed concerned about the size of investment in property buying and even restoration projects.
"It does worry me that the historically low level of interest rates are encouraging people to perhaps over invest in housing," John Fraser said.
Mr Fraser said the house price problem was particularly confined to certain markets.
"It does seem a little bit like a feeding frenzy, but when you get out of those suburbs into the outer suburbs it's less the case."
Australia's biggest Reserve Bank survey conducted by finder.com.au found that although the cash rate was expected to remain on hold tomorrow, Tuesday June 2, there could be another cut this year.
But with high property prices and interest rate hikes forecast for next year, more borrowers are expected to start fixing their home loans.
Jonathan Chancellor
Jonathan Chancellor is one of Australia's most respected property journalists, having been at the top of the game since the early 1980s. Jonathan co-founded the property industry website Property Observer and has written for national and international publications.