AUSTRALIA’S housing shortage may be driving prices higher but is locking out first-time homeowners and migrants needed to fill skills shortages across the country, the CEOs of Australia’s three largest banks said on Tuesday (Mar 26).

After years of ultra-low interest rates pushed home prices higher, Australia faces a long-term drop in the number of younger people buying homes, which could mean more people retiring in weaker financial positions, according to a 2023 government report.

At a banking conference in Sydney, the heads of Commonwealth Bank, National Australia Bank and Westpac, Australia’s top three lenders, blamed a housing supply shortage and urged local governments to speed up planning approvals.

“For the younger cohort, I think it is really a significant problem,” CBA CEO Matt Comyn told the AFR Banking Summit, when asked about a housing market with some of the worst affordability in the world by a measure of debt to income.

Westpac CEO Peter King said that prices will go up when you have a supply-constrained market, but that the current home prices “from a societal perspective, it is too expensive”.

He, however, added he was “positive on the housing market” citing “the fundamentals of ‘we need more houses developed’”.

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NAB CEO Ross McEwan told the event the country needed migrants but “we have got to get the impediments out and get the tradies (tradespeople) in and get building”. REUTERS