Regulation of the housing market is seen as the “next logical step” by Australian Securities and Investments Commission chief economist Alex Erskine as the watchdog claws for power.
Mr Erskine is believed to have written in a report that ASIC could regulate the housing market in much the same way the market watchdog monitors the stock exchange, The SMH reports. Beginning August 1st, ASIC will take over market supervision responsibilities from the ASX to monitor the stock exchange as the Government transitions supervisory power away from the ASX in the lead up to ChiX, a direct competitor to the ASX opening in Australia.
Given the role of housing as a trigger for the global financial crisis, Mr Erskine’s comments are reflective of the mood within ASIC to do more to regulate the housing market and prevent another GFC. The SMH sought comment from ASIC, who were quick to label Mr Erskine’s words as his personal opinion only, but given who the report was circulated by ASIC worldwide to securities regulators, is an implicit endorsement of Mr Erskine’s views.
Currently across Australia real estate agents come under the supervision of state bodies, bringing the supervision of real estate agents within the purview of ASIC would harmonise the function on a national level. Mr Erskine believes that the potential for market dislocations due to the restriction on housing supply, government grants and tax concessions, as well as banks favoring lending for housing due to construction were all reasons why market supervision for housing should be granted to ASIC.