Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Freddie Mac equivalent for Australia?

Staff Reporter 1 minute read

The federal government has been called upon to support liquidity in the Australian securities market in order to promote and maintain competition in the housing finance industry.

Joshua Gans of the Melbourne Business School and Christopher Joye of Rismark said in a proposal to the federal government that Australia was in need of a policy solution that would guarantee a minimum level of liquidity in the mortgage-backed securities market.

“Failure to act with a systematic policy response will see the heightened competition that emerged in the mortgage market over the past 10 years significantly dissipate,” they said.

The pair proposed that the government sponsor an enterprise similar to Fannie Mae and Freddie Mac in the US – “AussieMac” – that would leverage the government’s AAA-rating to issue low-cost bonds and acquire high-quality mortgage-backed securities from Australian lenders.

AussieMac, Messrs Gans and Joye said, would provide long-term liquidity to the market, especially during times of market failure and would “restore stability and long-term confidence to both the primary and secondary mortgage markets”.

Published: 27-03-08

Freddie Mac equivalent for Australia?
TheAdviser logo

If you’re feeling overworked and overwhelmed in this fast-paced mortgage market, it’s time to make some changes, and the Business Accelerator Program can help! Early bird tickets are on sale now. Work smarter, not harder, this year.



more from the adviser
Carolyn Murphy ta Teachers Mutual targets brokers in digital bank launch

Hiver, a new digital bank to be launched under Teachers Mutual, i...

mortgage money house Qld real estate body calls for stamp duty reform

The REIQ has slammed the Queensland government for failing to act...

Alexis Holloway ta Pallas Capital appoints senior credit manager

The non-bank lender has appointed a senior credit manager whose r...