CBA sees housing market safety net

Commonwealth Bank has rejected forecasts of a 40 per cent fall in Australian house prices. Chief financial officer Michael Cameron told a conference in New York that house prices in Australia fell by 1.6 per cent over the past six months but that he did not agree prices would drop substantially more. Cameron said the main drivers for housing prices in Australia were interest rates and unemployment. He said CBA expected interest rates would remain low and that unemployment would also remain low. Cameron said that were a major slowdown “about to occur in Australia the Reserve Bank would simply reduce the rates to create stimulus and more confidence to hold up prices.”