Paul Castran

The Reserve Bank cautioned the borrowers and lenders to be careful while offering an assurance that there is no possible housing bubble in Australia. However, the fears of property bubble were felt soon after the house price index (Australian Bureau of Statistics) increased by 20% during the year ending March.

Despite this, Luci Ellis, the RBA head of financial stability asserted that the Australian house prices had recovered from a small decrease during the year 2008. Moreover, the house prices in capital cities witnessed an increase of 12-15% as compared to the year 2008.

Ms Ellis said recent data suggested Australia does “not have a credit-fuelled speculative boom on our hands”.

“It would not be desirable for the current situation to turn into one,” she said in a speech.

“It will therefore be important for lenders to remain prudent in their standards.

“It will be equally important for prospective borrowers to have realistic expectations, and not to rely on a hoped-for capital gain in order to service their debts.”

During a residential property conference, she urged that housing prices in Australia had been under increasing pressure since majority of short-term drivers came from demand side. This was subsequent to an improved first home-buyers grant, lower than projected unemployment and low interest rates.

“The nature of the demand shock Australia faces means that it would be helpful if more of that demand could be accommodated with extra homes for occupation, instead of by higher prices,” she said.

“Some of that pick-up in construction does seem to be happening.”

She said the supply of housing was always going to be quite “sluggish”.

“But whatever the causes, the ability to add to supply is falling short of this higher rate of population growth, despite some pick-up recently,” she said.

“Naturally that is putting upward pressure on housing prices.”

Ms Ellis stated that it would be advantageous for the supply of new housings to be more flexible than it had been up till now. This is because more people needed a place to live. Moreover, both the prices of houses as well as rents could witness an increase.

The more that housing prices rise, the more some people might feel they must stretch their finances to buy a home, she said.

Paul Castran and Mark Forytarz, the two renowned personalities from Castran Gilbert have a lot of experience in the field of real estate. Both of them presided over many real estate sales. Mark Forytarz and Paul Castran share their views about the happenings of real estate market.

Recently, the Courier Mail published an interesting article that talks about the situation developing in Queensland. An extract from the article is as under:

Letters of warning in relation to property seizure have been sent to four businesses and eleven individuals in a bid to recover $257,000 from outstanding fines after a trial of strategy started on January 1. It is one of the measures introduced by the Queensland Government for recovery of unpaid fines with above $160 million outstanding.

Attorney-General Cameron Dick said that a warrant had been issued for sale of woman’s home at a public auction after she continuously refused to make the repayments for a five-year-old debt. Subsequently, the woman paid the fine in full thereby avoiding the auction.

Mr Dick said that fine-dodgers were required to accept the responsibility for their actions. “This is money that can be better spent on more teachers, doctors and nurses, or more schools, police stations and hospitals,” he said.

Under these measures, the fine-defaulters were checked for their assets. This allowed the Government to seize property such as cars and homes to make the payment for debts. People who need to repay an amount above $5000 can have their cars clamped. Moreover, the driver’s license can also be suspended for non-motor vehicle offences. During the first four months, about 64 clamping notices were sent to the defaulters.

However, Lawrence Springborg, the deputy Opposition Leader of Queensland stated that the Government had failed to manage the fine dodgers properly.

“As of February this year $214 million was owed, and 886,742 outstanding penalties and we are talking here about them issuing 15 warning letters up to the end of April,” Mr Springborg said.

Paul Castran and Mark Forytarz, the two key persons in Castran Gilbert have a lot of experience in the Australian real estate market. Both of them have presided over many real estate sales. Mark Forytarz and Paul Castran share their views about the ongoing market situation in the real estate sector.