Opposition Leader Angus Taylor has used question time to press the government over the number of Australians whose home loans may now exceed the value of their properties as house prices fall in Sydney and Melbourne.

Taylor asked Treasurer Jim Chalmers how many Australians were in negative equity, saying data showed half of homes bought in Melbourne and Sydney over the past 12 months were now worth less than their purchase price.

Chalmers responded that Reserve Bank governor Michele Bullock had recently described negative equity in Australian housing as very limited. Bullock said the most recent data suggested it affected less than 1 per cent of borrowers.

Chalmers also pointed to Commonwealth Bank earnings data released in August, which showed 0.5 per cent of the bank’s loan book was in negative equity.

The exchange came during question time as the opposition continued to challenge the government over falling property values and the impact of its housing and tax policies. A point of order raised by the opposition over the relevance of Chalmers’ response was rejected by Speaker Milton Dick, who said he would not accept “frivolous” points of order.

Chalmers then turned the exchange into a broader political attack, saying it was a reminder that the Coalition had been performing better under former opposition leader Sussan Ley than under Taylor.

Negative equity occurs when a borrower owes more on a home loan than the property is currently worth. While falling prices can increase that risk, the figures cited in parliament indicate that the proportion of borrowers affected remains relatively small.

Source: The Guardian