Australian property market will not collapse

Some thoughts on housing affordability and the movement of Australian house prices.

Category:

People & Blogs

Tags:

• webcam
• video
• karl295

[pauloz386]

Immigration is inflationary, and government controls demand by controlling immigration. A new immigrant needs somewhere to live immediately as they hit our shores, yet a newborn has at least 18 years before they need the same. Housing market has also been propped up by grants (first owner grants etc) since when has throwing money at something made it cheaper? How can we say it's a free market when the government stuffs around with it, housing is not an investment, it's a basic need.

[karl295]

@pauloz386 Actually immigration is nearly aways considered deflationary (in the CPI sense), but I get what your trying to say. Unfortunately for the younger generations we are going to be screwed for a long time to come yet. Baby boomers and the voting majority are more than satisfied with the way house prices moving! This is the cause for the majority of OUR economic concerns, an unfair system that is giving away cash in the truck loads to the wealthy and screwing everyone else.

[thedon169]

GFC Mark II. Unfortunately the collapse is imminent, we are on the edge of a cliff as we speak. Price isn't governed by events, or fundamentals. It is governed by mood, and across the globe, pessimism is taking hold once again. It won't be long before what Australia and Canada have missed out on so far, will catch up and even taking rates back to emergency lows won't help this time.

[karl295]

@thedon169 Well many very astute economist would agree. Debt in Europe at the moment is out of control to say the least and the US is far from out of the 5hit. Problem is growth has been a function of borrowing and spending for two long. I hope you are right but in my opinion a double dip is unlikely. For the most part global economies are picking up. Saying that you have to question how much is a result of all the stimulus measures that have been put in place that are still very real

[Mollarooza]

But when interest rates keep rising mate people are going to default. they are already starting to feel the pressure in the outer suburbs here in Sydney and more IR are going to hurt them

I don't really buy into this whole supply/demand because if it was true then there would be alot more homeless people but I don't think there has been a huge growth in homelessness. Most people still have a roof over their heads.

I think it has alot to do with the amount banks lend ppl.

[karl295]

@Mollarooza Not questioning that people will default and this will be more prevalent in areas such as outer Sydney suburbs for the obvious reasons. Also be aware there are many places that are not so obvious that may also see significant foreclosures such as property investment markets like the Gold Coast that are dominated by many asset rich cash poor baby boomers. Nonetheless I don't think we will see a huge correction (in most markets) unless things get really bad ie like thedon said GFC2.0.

[sighbaru]

You are 1010%correct Aussies are by far the smartest folks on the planet a crash can't happen here!

[thetubersworld]

your a dreamer mate you have not a clue

[Battleneter]

Property bubble has ALREADY popped, but this doesn't happen overnight, it will happen over the next 5 years. The process is self feeding, there is now no way to artificially keep up prices.

[DocBrewster]

@aus2045 Isnt Canada just as, if not, more overpriced? (Or is it just vancouver?)

[pauloz386]

@karl295 , I was referring to housing inflation not CPI, high levels of immigration increases the demand for housing, but the same could be said for all other essentials. Sure immigration has a deflationary effect on wages and conditions, but they still need housing, so supply and demand kicks in. With over 160,000 new arrivals each year, little wonder we face a housing affordability crisis.

[aus2045]

I think the australian property market, is about 70% over valued, and is best to be avoided until prices drop to a real affordable leve. This may take 10yrs.. . If you really want to invest in property, try Canada.