Investors could lead charge on house price boom

Cashed up superannuation investors could lead Australia into another rampant house price boom.

Before the global financial crisis struck late last year, a rule change was made that allowed super savers to use funds as a deposit on an investment property.

According to a report in the Daily Telegraph, finance firms have reported an increase in the number of enquiries from people with super savings looking to invest

The amount of super savings used for property investment rose to $44 billion in 2008 – a 25 per cent leap on the previous year.

AMP capital acting chief economist Shane Oliver said recent improvements to consumer confidence could open the floodgates for super investors looking to buy into the property market.

However, Mr Oliver also said that a rush of investment could force the Reserve Bank of Australia to raise rates quickly and unexpectedly.

“If economic data continues to surprise on the upside then the likelihood of an interest rate hike in the next few months will rise even further,” he said.

Cashed up superannuation investors could lead Australia into another rampant house price boom.

Before the global financial crisis struck late last year, a rule change was made that allowed super savers to use funds as a deposit on an investment property.

According to a report in the Daily Telegraph, finance firms have reported an increase in the number of enquiries from people with super savings looking to invest

The amount of super savings used for property investment rose to $44 billion in 2008 – a 25 per cent leap on the previous year.

AMP capital acting chief economist Shane Oliver said recent improvements to consumer confidence could open the floodgates for super investors looking to buy into the property market.

However, Mr Oliver also said that a rush of investment could force the Reserve Bank of Australia to raise rates quickly and unexpectedly.

“If economic data continues to surprise on the upside then the likelihood of an interest rate hike in the next few months will rise even further,” he said.

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