Economy, small business may be hit by housing slump: Treasurer

Treasurer Josh Frydenberg has raised fears the property downturn in Sydney and Melbourne could flow into the broader economy, hitting small businesses that have taken out loans on the value of their family home.in Canberra, a fortnight out from his first budget mark a shift from the top levels of the Morrison government which has prided itself on using a "scalpel" to treat over-heating housing markets but now faces price falls largely beyond its control.

Speaking from his office in his western Sydney electorate of McMahon, where prices have fallen by 9 per cent, Mr Bowen said when the market was rising he was regularly confronted by constituents worried about "the crazy prices" but few offered the same level of concern now that they had begun falling.

"I’m worried that if the Labor Party get their chance to abolish negative gearing as we know it and increase capital gains tax by 50 per cent, then that will drive housing prices down with a spillover into the real economy and household consumption," he said.Jessica Hromas "Josh Frydenberg wants us to believe that house prices go down and rents go up? In what universe does that happen?

"It is not something that has to come into force immediately if a Labor government is elected," he said. "We will do it sensibly.""This is a bad policy and it should not be adopted any time. But it is particularly egregious of labor to pretend that it works in both a falling housing market and a rising housing market. It's illogical," he said.

Source: News Formal (newsformal.com)

The next fear narrative?

That's capitalism isn't it? Perhaps when labor get in and wages increase Ppl can afford to buy houses again and prices may go up.

Only the little houses.

Looking at this issue in a positive way. Housing affordability has improved for our young generation. The price fall hits on investors who have multiple investments. This is normal because no investment is risk free.

Slump!!! Didn’t complain when the real estate bubble was being inflated to unhealthy unsustainable proportions. Now complains about a controlled correction which is far preferable to a uncontrollable crash. Disgraceful 🙄

I'm more interested in hearing what solutions (policies) he has to avoid crashing the housing sector and the economy. Artificially propping it up using neg gearing is unsustainable. Time to use other tools out of the box...if he has any. Auspol

Small business along with wage earners pays this countries way in taxes. Big business certainly don’t. What a complete and utter fucking disgrace. The tax office only hunts down the minoes.

Just remind me... whose government is it now and for the last 6 years, not Bill Shorten' s

💬We are already in a slump: wages, economic growth, business, housing. The only way to get out of it is VoteOutLNP

Has your Coalition Only Business PM`s,Manipulative Scott Morrison when Treasure,blame Retirees for not down side,so young couple had chances to by a home with backyard,fact Builders Not allow this. Negative gear,1.7 Millions +the same was often to the corner home. Bad for locals

So JoshFrydenberg under the current “superior” economic management and settings of the LNP the broader economy will be hit by already falling house prices? If as you say you will ‘stay the course’ with your economic approach, how can we have confidence in a future LNP govt?

This man is the best Gloom and Doom bloke I've ever heard, bit of a sad lad I think ,get a life Josh nobod is listening, that I'm sure of .

They let the housing market run too hot and did nothing. Eventually the regulators had to step in and do the job.

Increase low pay wages so this workers,working in small business have more money to spending at small business, that`s where they spent they money.Overseas a country who has the most expense elecretricy, One CEO said price is right, the Wrong is the low wages no money,spend power

Hmmm “may” funny you mention that word; cause in “May” there will be an election. And any thing that happens to the economy will be because you have spent the last 6yrs only talking about Labor and not being the Gov. auspol I also “may” vote for you, I won’t though.

Choked wages - stalled the economy - great work, little Josh!

The small business scare campaign now in full swing. Everything they say and do is create fear in the populace. They never have anything to offer so it always comes back to fear and of course, hatred which is a specialty.

Housing slump is on watch josh and can’t blame labour for that

Then you should have curbed negative gearing years ago and made sure the banks couldn't hand out loans like confetti.

How MANY people have they put on extra after PENALTY RATES EXIT!! MY guess a BIG FAT ZERO!! If the FARMERS can do it TOUGH I am sure BUSINESSES WILL SURVIVE JOSH!!

Yeah, a slump you've created.

NO we have been hit by fuckwit lib construction recession in the CBD sydney. Business forced to close due to stateLib mismanagement. NO STAFF because FED LIBs cut visas. We have been stuffed for 4 years Thanks to your mismanagement. VoteThemAllOut

Oh, JoFro! We really-really-really-really wanna let you go.

wages have been stagnant for 6yrs n prop prices had been soaring driven by foreign buyers With home prices drop many more workers would find an opportunity to buy With many unit prices r still above $1mil let it drop 20% to make them more affordable Bugger d builders

So are we supposed to volunteer to pay more for housing to fix that?

Australian economy will tighten further as levels of domestic debt is high. there would be increased defaults and homelessness will be increasingly visible. running a country is like running a business. if money in money spent, economic collapse is a given. money is held by few

How would JoshFrydenberg know? He clearly has not developed even the most basic understanding of economics. I didn't think it possible, but he's an even worse Treasurer that FauxMo.

JoshFrydenberg should stop blaming Labor for everything, and blame yourselves for lack of positive policies that would actually help! auspol

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