Australia 'should add to housing supply now'

Australia can prevent a housing bubble occurring by concentrating heavily now on increasing the supply of property, the governor of the Reserve Bank of Australia Glenn Stevens has said.

Speaking at a charity event, the governor noted that the present moment is an opportune one due to the low costs of borrowing and raw materials.

He stated: "This ought to be the time when we can add to the dwelling stock without a major run up in prices".

Not to do this would be "disturbing", Mr Stevens said, as it could affect the affordability of property that generations of Australians have been able to "take for granted".

Meeting this and other tasks in hand should help Australia recover strongly, with the economy showing many positive signs, he argued.

Earlier this month, the bank held the cash rate at three per cent, but Mr Stevens said there is scope for further reductions if required, something that could lower mortgage costs.

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