The Australian government is taking measures to encourage competition in the mortgage market, said Treasurer Wayne Swan.
Mr. Swan suggested that the federal government’s investment in triple-A rated mortgage backed securities is giving more options to Australians who decided to compare home loans.
"The government’s support has been critical to preserving the infrastructure of this very important market," said Mr. Swan.
According to a report, the Australian government allocated A$8 billion for investment in residential mortgage backed securities in November, in addition to the A$8 billion it committed a year ago.
Many small lenders depend on this fund for their home loan packages.
Mr. Swan also said that the government’s action is helping to boost confidence in the market after the global economic crisis.
A survey conducted by the Commonwealth Bank of Australia and the Housing Industry Association this week indicated that housing affordability in the country dropped 18.4 percent in December last year, and it was 22.3 percent lower than the previous year.