The government 'is supporting competition in the home loan market'

Wednesday 24 February 2010

Article by Mozo

The federal government is taking steps to promote competition in the home loan market, treasurer Wayne Swan has said.

Mr Swan suggested that the government’s investment in triple-A rated mortgage backed securities is providing more options to Aussies who decide to compare home loans, the Australian Associated Press (AAP) reported.

"The government’s support has been critical to preserving the infrastructure of this very important market," Mr Swan said.

According to the AAP, the government set aside $8 billion for investments in residential mortgage backed securities last November to add to the $8 billion it committed a year earlier.

Many smaller lenders depend on such funds for their home loans packages.
Mr Swan claimed that government action is helping to return confidence to the market after the global financial crisis.

This week, a survey conducted by the Housing Industry Association and the Commonwealth Bank of Australia revealed that housing affordability fell by 18.4 per cent in the December quarter last year and was 22.3 per cent lower than a year earlier.

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