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Canberra’s Boutique Real Estate and Property Management

Stanhope rejects any influence on interest rates

By Jazz 7 August 2007 28

After reading the last submission i found it hillarious to come accross this article in posted on ABC Online yesterday where Hopeless Stan rejected claims that the ACT had some influence on housing interest rates.

Nothing at all to do with spiralling housing costs. Or the mass land sales in order to get his budget in surplus.

I also found it amusing that he’s having a go at Howard and Co. for not keeping election promises from 4 years ago that interest rates would never go up. hello… pot calling kettle…

Stanhope is not alone though, as seems all the state Labor leaders are jumping on the same bandwagon

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28 Responses to
Stanhope rejects any influence on interest rates
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sepi 7:28 pm 10 Aug 07

Canberra households are growing up.
The kids are moving out and need homes in Gungahlin, and the parents are still living in the family home in Woden somewhere.
So the population doesn’t have to increase, the changing demographics are still putting pressure on housing availability.

thetruth 4:43 pm 10 Aug 07

Take a look at the Chief Ministers website – you will see in the FACT box him crowing about housing affordability and in the recent media releases blaming the federal government about the worst housing affordability in decades.

The fact is that interest rates are still lower than in th past so what has changed – the major thing in land supply it has been tightening for decades as states maximised profits through land corps. TIME FOR A BIT ON HONESTY IN THE DEBATE

He didn’t say he would keep interest rates low – he said interest rates would be lower under liberal than labour govt. The govt itself doesn’t set rates – the RBA does, in response to various economic indicators. Blaming the PM is the philistine’s way out.

boomacat 7:09 pm 08 Aug 07

Well, after today’s rate rise, Johnny is telling us he never even said that he would keep interest rates low.

What a pile of steaming turds.

The man is a liar.

noodle 11:47 pm 07 Aug 07

The current “debate” about interest rate rises and the effect of housing affordability is a furphy. Interest rates are still low compared to 20 years ago. The problem is the ACT government has come too late to fixing land supply, and they still do nothing at all about the taxes. Stanhope has no credibility on this issue at all. I feel sorry for people who not only can’t buy a house, but can’t find one to rent here either!

pierce 9:49 pm 07 Aug 07

Getting back to interest rates, wasn’t Howard banging on about the “fact” that state/territory government borrowing reduced the available supply of money for banks to loan which increased demand and raised interest rates.

Conveniently forgetting that with the internationalisation of borrowing over the last 20 years, the supply/demand question is irrelevant, even perhaps moronic.

Little wonder Costello said Johnny was clueless on economics.

bonfire 5:43 pm 07 Aug 07

wait for a recession and all teh single folks in three bedroom houses will rent out one or two rooms.

bang – housing surplus – price decrease

Jazz 4:02 pm 07 Aug 07

could also have something to do with a change in the average size of a household. for convenience sake a population of 300,000 with 3 people per household needs 100,000 houses.

make that 2 per household and you suddenly need a whole heap more properties to live in

Ralph 3:50 pm 07 Aug 07

Population has been increasing in the ACT. Look at the Census.

bugalugs 3:21 pm 07 Aug 07

Before we waste too much time discussing land releases or lack thereof etc., can someone pre explain to me where the demand is coming from.

Year after year we are told that there is neglgible population growth in Canberra yet there seems to be this miraculous demand for land and housing.

boomacat 1:42 pm 07 Aug 07

I would think it is more accurate to say the RBA maintains interest rates in response to economic indicators.

Jazz 1:03 pm 07 Aug 07

sorry boomacat. you are correct. the RBA does it as a function of governance of the economy in response to the fiscal policy of the elected government.

Woody Mann-Caruso 12:41 pm 07 Aug 07

i didnt mention increasing land supply

I’m sorry. I must have been temporarily blind when I read the words “Or the mass land sales in order to get his budget in surplus”.

boomacat 12:15 pm 07 Aug 07

If I was a builder I would take advantage of the tight market and charge high prices too, it’s all part of the capitalist free market.

Snahons_scv6_berlina 12:11 pm 07 Aug 07

VY already pointed out one of the significant issues. Even if they release large parcels of land at “cheap” prices. There isn’t enough builders around. As a result you may get what seems a reasonably cheap block but the builder will slug you exhorbitant price for construction because:
1. He doesn’t care, he’s already got more work than he can handle.
2. He can jack his prices up so the total cost of ownership to the home owner is relative comparable to what the existing market rates are.

There’s only one way house prices generally ever fall – interest rates in double digits. Until then you’ll get stung somehow (land cost or construction cost).

boomacat 11:47 am 07 Aug 07

Jazz governments don’t increase interest rates, the Reserve Bank does, which is totally independent of government.

Howard promised everyone that he was in control of interest rates and could “keep them low” at the last election. Since then interest rates have gone up 4 (maybe 5) times. Now Howard tells us it’s actually the States who control interest rates.

Sorry mate, you can’t have it both ways. Sounds like another Howard lie to me.

Your idea that releasing large parcels of land (increasing supply) has increased price seems totally contrary to economic principles.

And I’m sure that every homeowner in the ACT would be really impressed if Stanhope dumped a load of land onto the market at artificially low prices, thus slashing the value of their own homes and, for many Canberrans, putting them in negative equity (ie they owe the bank more than the value of their house).

only he could “keep interest rates low” during the last election campaign. against the ALP to hoodwink voters at the last election, whom he then later betrayed by introducing WorkChoices.

Jazz 11:37 am 07 Aug 07

and with more money comes more inflation and eventually changes in interest rates. For stanhope to say that the economy in canberra is having NO effect on bank interest rates is complete bollocks.

There are a number of factors, but people having more money to spend is definitely one of them.

pierce 11:25 am 07 Aug 07

Didn’t Johnny tell us the other week that high house prices were just a side-effect of our national prosperity?

flyingblind 10:36 am 07 Aug 07

It already has for our office Ralph, none our our interstate Branch’s would touch Canberra with a barge pole because of the huge cots involved.

I work for a private company so i dont blame the others not coming down here as there are no financial incentives to do so.

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