Treasurer Peter Costello sees a further dampening of the market and a slowdown in the wealth of households, but is confident of a soft landing
The Australian government's budget, announced last week, might be good for the country's higher income earners and the superannuation industry but it is unlikely to provide much of a boost for the property market.
Treasurer Peter Costello, the architect of the government's economic policy, was quite open about the budget's impact on the property market when he predicted a bleak outlook for house prices.
Mr Costello foresaw a further dampening of the market, compounded by a 'substantial slowdown' in the wealth of Australian households.
Rental yields were still very low, he said, 'suggesting that house prices may fall further in real terms' but there would be a soft landing, with the 'current housing market unwinding in an orderly manner'.
Mr Costello also said the number of people investing in property would fall by 2 per cent over 2005-06.