Developers slam RBA boss

Two Melbourne inner-city apartment developers have hit back at the Governor of the Reserve Bank who has repeated his warning of late 2002 on the dangers of investing in the CBD unit market.

Eddie Kutner of Central Equity and Daniel Grollo of Grocon said Mr Macfarlane had “talked down” the Melbourne market when the fundamentals were in fact sound. The economy is thriving, interest rates are low, the population is growing and employment is high, they said.

Mr Kutner said demand for inner-city units had decreased since Mr Macfarlane first made his comments in late 2002 and supply is now also about to fall due to rising building costs and added governmental requirements, such as the new energy rating system.