Media hype about skyrocketing house prices is calculated to lead more lambs to the slaughter, when almost half of the 135,000 suckers conned by Kevin Rudd into taking out a mortgage last year are already struggling to make payments.

The Rudd Government’s $21,000 first homebuyer’s grant, now expired, made housing more unaffordable, by driving the property market up to record highs; increased the average first homebuyer’s mortgage by more than double the amount of the grant; and exploded Australia’s household debt to equal the national GDP.

Now, coinciding with the end of the first homebuyer’s grant, the media has started hyping the property market, playing up the 18.5 per cent jump in Melbourne’s median house price last year, and trumpeting forecasts of million dollar average house prices within ten years.

Meanwhile, a Fujitsu Consulting survey has revealed 45 per cent of first homebuyers from the past 18 months are either in “mortgage stress”, and using credit cards to meet obligations, or in “severe mortgage stress” and are missing payments.

Future interest rate rises, and job losses, will drive many more homeowners into crisis, which in turn will collapse the property bubble, wiping out millions of individuals, as well as Australia’s entire banking system.

(All of Australia’s banks were technically bankrupt in October 2008, squeezed between $643 billion in foreign debt, and falling domestic property prices which raised the spectre of negative equity—properties worth less than the mortgages. However, the Rudd government didn’t reorganise the bankrupt system, but, at the banks’ request, covered it over, by guaranteeing their foreign debt, and extending the first homebuyer’s grant, to reinflate the property bubble.)

Citizens Electoral Council leader Craig Isherwood today declared the only solution is the CEC’s Homeowners and Bank Protection Bill (HBPB).

“We can’t keep creating more debt to save the bankrupt financial system,” Mr Isherwood said. “We must reorganise it, using the HBPB.

“The Government’s responsibility is the common good of the people—not propping up housing bubbles and bankrupt banks.

“Instead of protecting the people, the government—and the media—are shysters preying on suckers, to feed them to the banks.”

The CEC National Secretary explained, “The HBPB will keep families in their homes, while putting the banks through bankruptcy reorganisation, which involves: sorting through their debts and cancelling the bad ones; writing off their unpayable derivatives obligations; and restructuring their mortgages.

“Because this wasn’t done when we first proposed it in August 2007, we have created a lot more debt, and are now in an even bigger mess.

“Any more debt will trigger a hyperinflationary meltdown, so now the HBPB is our only choice.”