NAB boss says house prices should fall as country opens: Promotes vax pass

National Australia Bank chief Ross McEwan is predicting a 20 percent jump in house prices across Australia this year but called that pace of growth unsustainable. 

Appearing before a parliamentary inquiry, McEwan said he had been in early talks with the prudential regulator about the overheated housing market but stated that it is too early for APRA to intervene. 

"My recommendation {to APRA} was that we leave it two or three months and let more stock come on the market and see what that does,” he said, adding that lockdowns have caused the supply of new housing stock to dry up. 

 “It’s very difficult to get a house on the market when the entire industry in Victoria is pretty much closed down - you can’t even see a rental property. 

“Those things constrain a market quite badly so let’s open the market up.” 

McEwan also told the inquiry that Australia needed its own national vaccine pass, ready to launch when vaccinations hit 80 percent so that people have the freedom to attend restaurants, sporting events, major concerts, and domestic travel. 

“This should be developed alongside existing plans for an international vaccine passport for Australians to prove their immunisation status overseas and on their return to Australia. 

“When we can safely move from restrictions to freedoms, I am very confident the Australian economy will recover swiftly.” 

Lockdowns not as damaging as last year 

As for business, the NAB chief executive said the current round of lockdowns had not been as damaging for its customers as last year. 

“Many businesses are in a state of hibernation, waiting for restrictions to open up and ready to get going again,” he stated. 

However, McEwan warned that the situation for small business customers in central Sydney and Melbourne is more fragile. 

The number of customers in financial hardship is rising since the Delta outbreak, he continued, but most continue to make some form of payment. 

The banking chief noted that at 31 August, just over $1.8 billion in lending was on deferral. This compares to $58 billion at the height of the pandemic last year. 

“Looking more broadly across Australia and all business sectors, what we are experiencing is a multi-speed economy. 

“While some businesses are really hurting, others are doing incredibly well. This is particularly evident in mining, agriculture, and some forms of manufacturing." 

Before the most recent lockdowns, the level of small and medium business lending activity was the highest the bank had seen in six years. 

 

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