There's no housing bubble: Westpac chief Brian Hartzer

Westpac Banking Corp chief executive Brian Hartzer says the RBA faces a difficult challenge.

They had to, on the one hand, support parts of the economy with low interest rates, while avoiding a housing price bubble, he told The Australian Financial Review's Chanticleer column.

Hartzer advised he does not believe Australia is in the midst of a housing asset bubble.

He says there is no evidence in Westpac's housing lending data that investors are buying houses for a "quick flip" to another buyer.

But he says Michele Bullock's recent comments highlight the need for action by local and state governments to ease the barriers to new housing development.

He thinks there needs to be co-ordinated policy action to fill the demand supply gap.

Hartzer indicated he was not a surprise to Hartzer on why Chinese nationals would want to live in Australia and take advantage of the high quality standard of living, including the education system.

He says foreign investment has been a feature of Australia for many years and continues to support the financing of new unit developments which, in turn, helps to resolve the lack of supply in the residential market.

Hartzer thinks the capital controls in China will eventually have an impact on the amount of money being invested in the Australian housing market.

Fresh data shows foreign buyers were responsible for purchasing about 11 percent of NSW homes, with Chinese buyers accounting for 32 percent of these buyers.