I really can't believe all this pussy footing around by our pathetic politicians tinkering around with talk about allowing access to super to use as a deposit to buy a home. Any meat head knows and there is a mountain of evidence to show that any handout such as first home owners schemes result in housing booms and further INCREASES in housing prices so if young people suddenly can access their super for a deposit on a home it will just have the same effect as a first home owners grant.
I named this subject Reserve Bank because they are the ones who can, and should have corrected the housing bubble problem in the first place but they don't seem to have the guts and I strongly suspect, though they are "supposedly" independent of government control, they are operating under strong pressure by the government of the day for their own self survival.
They have continued to drop interest rates when in fact if they had any foresight they should have been lifting interest rates to take the heat out of the market. But they lack the courage to do so. Why? Because they are frightened of causing home owners pain. Pain is a fact of life and just like the most common consumer advice, buyer beware. If you buy at the top of a boom you are taking a punt that house values will continue to rise and the reality is it can't. Historically the trend is in the long run real estate is a safe bet but the rapid rise in our property markets have been unsustainable, much like our recent mining boom.
Time for the Reserve to show some balls and make the hard call and lift interest rates and not mess around. There should be a 1% increase immediately and then steadily increasing them by a quarter of a percent until it has the effect it needs to have. If that means we have as Paul Keating once famously said, the recession we had to have, then so be it. I suspect a lot of these self serving pollies and Reserve Bank board have a vested interest.
