...Reserve Bank Governor Glenn Stevens does not think Australian house prices are unreasonably high and does not believe they will drop. Nor does he agree that we have a price bubble (here).
Using price-to-income ratios - a gauge of affordability - and price-to-rent ratios, The Economist suggests home prices are overvalued by about 25 per cent or more in Australia, Belgium, Canada, France, New Zealand, Britain, the Netherlands, Spain and Sweden (here).
Using price-to-income ratios - a gauge of affordability - and price-to-rent ratios, The Economist suggests home prices are overvalued by about 25 per cent or more in Australia, Belgium, Canada, France, New Zealand, Britain, the Netherlands, Spain and Sweden (here).
“Property booms are never driven by supply and demand – they are driven by credit. And credit is the pretty hand-maiden of debt,” he told a room of about 300 people at the ticketed event....“It screams to me – running naked down Darling Harbour – that this property market is overvalued,” he said. (here)
The AUD at this very moment is hollowing out the economy – anyone not believing that should go have a chat with any exporting or import competing company and see if they are looking to take on more people and have more work, or are easing back.... .....Now cast your eyes to Australia’s banks. They are a significant factor in the overseas borrowings. They know that they can get overseas funds which are looking for a yield, and that they can place those funds in Australia. ............Bank lending, particularly for mortgages has helped inflate Australian housing prices to insane levels. The mortgages taken out by Australians have helped push their private debt levels to global highs. Current private debt to disposable income is circa 145%, mortgage debt to GDP is about 85% (here).
No comments:
Post a Comment