The Government's bailout of the commercial property sector is intended to forestall a rout in property values that could spill into the private housing market.

A leading conservative economist, Access Economics adviser Ian Harper, said yesterday the danger to the housing market was so great that public intervention was warranted.

'In normal times, the Government ought have no business lending to property or to anything else, but these are extraordinary times,' Mr Harper told The Australian.

To illustrate, Frank Lowy's Westfield Group yesterday foreshadowed a $3bn write-down and cut in dividend for 2009, reflecting the poor state of the US property and retail markets.

The Australian