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Report calls for more govt funding

Staff Reporter 1 minute read

A report by Access Economics has found the government needs to put more funds into residential mortgage backed securities (RMBS) if the commercial property market is to subsist.

The RMBS funding stood at $60 billion in 2006 and 2007, but fell to just $10 billion in 2008, The Australian Financial Review has reported.

“With limited funds available for loans, low loan to valuation riskier commercial borrowers, SMEs and the self-employed are losing out to safe residential borrowers,” the Access report said.

The Access report suggested the government become a buyer of last resort, which would enable investors to cash their holdings for a fair price, as there is currently no secondary market for RMBS.

Report calls for more govt funding
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