ANZ's Australian CEO, Phil Chronican, questioned the merits of residential property as an investment option in a speech yesterday, as well as the suitability of tax deductions on loan repayments on some investment loans.In the speech, made in Sydney, Chronican said that, "If you compare housing with any other form of investment it looks weak on most criteria". The Sydney Morning Herald published an abridged version of the speech.Chronican said ANZ estimated that 20,000 fewer dwellings were built each year than were needed to keep pace with population growth, with a shortage of 230,000 dwellings.Affordability, however, remained a constraint, and "the number of people per household in Australia has increased over the past two years, as subdued supply and affordability limits finally bite."Chronican said there was "no doubt that capital gains made by most people in the property market over the past 15-20 years have created an unsustainable perception of housing as an attractive investment vehicle."Taking a clinical look at the merits of property as an investment option, any investment should be judged by the total cost versus the total expected return and the risks involved."He called for a range of supply and demand-side measures, including freeing up more land for development and encouraging higher density housing.He also said that "governments might want to look at whether the extent of negative gearing tax breaks are fostering an unhealthy focus on housing as an investment, thereby compounding the affordability issues."