Australian Housing Situation Dire?

Hugh Pavletich gives his thoughts on Australia’s Housing

 

Southern Rural Urban Boundary with Future urban zones in yellow
Southern Rural Urban Boundary with Future urban zones in yellow

 

WHEN WILL THE AUSSIE HOUSING BUBBLE BURST ?

Hugh Pavletich, 10 September 2014

 

Peter Martin, Economics Editor with The Age (Fairfax) Melbourne outlines the extent of Australia’s housing bubble and vulnerabilities … and asked when the bubble will burst …

(Australian) house prices are inflated and a fall seems certain – the only question is when … Peter Martin …The Age &  Sydney Morning Herald

http://www.smh.com.au/comment/house-prices-are-inflated-and-a-fall-seems-certain–the-only-question-is-when-20140908-10drmx.html

The extraordinary bubble behaviour of Sydney buyers (current Median Multiple in excess of 9.0 refer Demographia Survey) …

Home buyers line up for three days to buy property … Eryk Bagshaw … Sydney Morning Herald

http://smh.domain.com.au/real-estate-news/home-buyers-line-up-for-three-days-to-purchase-property-20140903-10btc7.html

Local Government inflation (causing them to strangle land supply and plunder the development / construction sector) leads to housing inflation which in turn leads to general inflation … which explains why Sydney families are “struggling” to live on $A245,000 a year …

Feeling the pinch? Take part in a cost of living survey … News Com Au

http://www.news.com.au/finance/money/feeling-the-pinch-take-part-in-newscomaus-cost-of-living-survey/story-e6frfmcr-1227041183279

Housing is going in to “bubble territory” if it exceeds 3.0 times household income or about 1.2 times Gross Domestic / State / Metropolitan Product …

2014 10th Annual Demographia International Housing Affordability Survey (data 3rd Qtr 2013)

http://www.demographia.com/dhi.pdf

There is about $NZ400 billion of excess bubble value in the New Zealand housing market and in excess of $A2.5 trillion of bubble value in Australian housing to be wiped out at some stage.

Irelands overall metro Median Multiples tanked from about 4.7 Median Multiple in 2007 (refer 2008 4th Edition Demographia Survey) to 2.8 Median Multiple (refer 2013 10th Edition Demograhia Survey), wiping a quarter trillion euros out of bubble value out of its housing market and putting its Banks to the wall.

New Zealand and Australia’s metros are currently in excess of 5.5 Median Multiple (this year’s Demographia Survey … adjusted).

New Zealand’s Bubble Economy Is Vulnerable | Hugh Pavletich | Scoop News

http://www.scoop.co.nz/stories/HL1404/S00166/new-zealands-bubble-economy-is-vulnerable-hugh-pavletich.htm

The New Zealand Authorities have started on the path of subduing its housing bubble … while the Australian Authorities have chosen not to …

NZ shows Australia how to address housing policy | Leith van Onselen | Macrobusiness Australia

http://www.macrobusiness.com.au/2014/09/nz-shows-australia-how-to-address-housing-policy/

The Chinese are desperately attempting to reform their economy, with a shift from excess investment …

Credit Crunch Is No Reason to Resort to Old Ways – CaixinOnline

http://english.caixin.com/2014-09-03/100724738.html

Will the rapid falls in commodity prices, trigger the bursting of the Australian and New Zealand housing bubbles ?

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Attribution: Hugh Pavletich; Performance Urban Planning; Christchurch, New Zealand

 

Further commentary can be found here: Who’s to blame for Australia’s housing bubble?

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