The Australian economy has been one of the best performing economies since the Global Financial Crisis, avoiding an economic recession experienced by many other developed countries. Several factors have contributed to this success, including effective economic policy and regulation. Nonetheless, Australia continues to face many challenges and economic policy needs to be responsive to the changing national and international landscape. Some of the key challenges identified for 2015 include:
1. The property market
2. the federal budget, and
3. Unemployment and jobs growth
Your task is to:
(a) Provide an overview of current conditions and challenges for each of the three areas listed above, detailing why these represent challenges to both economic stability and economic growth.
(b) Critically analyze the approach of economic policy makers and regulators in dealing with the specific challenges posed in each of these areas, including an appraisal of the value of alternative policy or regulatory approaches
Please only do Part (1) Property Market – housing
Structure to follow:
1. Current overview of the property market in Australia
2. Challenges of the current market for property and its effect on the stability of the Australian economy
3. Analyze how policy makers dealt with the specific challenges (overview of the regulations)
4. Appraisal of the value of alternative policy or regulatory approaches
Use RBA (Reserve Bank of Australia) publications – talk about what happened in property prices, why property prices rise, talk about foreign investment in property and how it’s affecting prices of housing, how RBA is responding to property prices and how challenges are being tackled, use APRA and treasury for statistics and publications as well. Talk about whether property market is in decline or not and why: you can refer to whether household debt is increasing and therefore people cannot afford buying property or refer to the lifestyle of Australians that affect why they do not purchase property as much. And talk about effect of Chinese economy on the property market of Australia with any future expectations – what will happen to Australian property market in case china enters a recession or in case Chinese economy grows. Also use graphs that are linked to the content (use as many as possible). It’s a small assignment so you can use tables where possible and where it can still be clear. I trust you so please do a good job – add whatever you think is necessary to answer the questions of this assignment.
I have provided you few links but please look for more links and publications.
Link to RBA minutes: http://www.rba.gov.au/monetary-policy/rba-board-minutes/2015/2015-09-01.html
Link to Graphs: http://www.rba.gov.au/publications/fsr/2015/mar/html/graphs.html
Link to the housing market: http://www.rba.gov.au/publications/smp/2014/feb/html/box-b.html
Link to Chinese residential property market: http://www.rba.gov.au/publications/smp/2014/aug/html/box-a.html
Link to Australian Domestic conditions: http://www.rba.gov.au/publications/smp/2015/aug/html/03-domestic-economic-conditions.html
Link to household debt: http://www.rba.gov.au/publications/smp/2015/aug/html/box-b-measuring-household-debt.html
Link to Implications of Lower Population Growth for the Australian Economy: http://www.rba.gov.au/publications/smp/2015/aug/html/box-d-implications-of-lower-population-growth-for-the-australian-economy.html
Link to Offset Account Balances and Housing Credit: http://www.rba.gov.au/publications/smp/2015/aug/html/box-e-offset-account-balances-and-housing-credit.html
Link to APRA: http://www.apra.gov.au/adi/Publications/Documents/141209-Letter-to-ADIs-reinforcing-sound-residential-mortgage-lending-practices.pdf
Link to Treasury: http://www.treasury.gov.au/
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