Property expert Margaret Lomas has lambasted reports, appearing today on the Sky News website, that low-end house prices will collapse with the winding down of the first home Owners Boost.
"If you understand the economic drivers, I just can't see how that's going to happen," Lomas told yourmortgage.com.au. She pointed to the significant numbers of investors now entering the market as well as the expected 78,000-dwelling shortage in 2010.
Blaming "careless forecasting", Lomas noted that the same predictions about the sub-$500,000 market were made at the beginning of the GFC. The predicted catastrophe did not occur. "In fact, [the market] grew during the last 12 months," Lomas said.
"I think it's a load of hogwash. It's so contrary to all the evidence being presented at the moment."
Recent surveys have shown that first homeowners are in the market not because of the boost, but because of affordability. "And investors are in the market for the same reason," Lomas said.
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