Thread: The bubble

With great swathes of Australia's housing deemed 'severely unaffordable' by international monitors, and the long looming threat we're in a property bubble - what does this actually mean for property owners if the bubble bursts, and how will it likely play out?

Is it a matter of a very fast slump in value triggered by a global event? A minor adjustment? Does it just mean house prices will stay stagnant for a decade or so? Or does it mean house prices will trend downward indefinitely?

I'm finding it very hard to find solid information on the likely scenario, and the only mouths doing any talking seem to be those from camps with high stake vested interests - corporate bankers, real estate firms, and the ever-present double-talking politicians. Maybe i'm being overly skeptical, but seems to me asking these groups of their opinion is like asking the lying child where the missing lolly is.

Is there any threat at all of a property bubble, or is it all catch-phrase-ology and media beat-up?

Originally Posted by Mick_Marsh

Karratha is a little different to , say, Melbourne.
Kerratha's prices were well over inflated due to FIFO workers and the mining and resources industry. Now the mining boom is over, Karratha's prices should be falling to more normal levels.

Yes - Karratha prices (and Port Hedland) are definitely over inflated due to the mining boom. So are Perth prices albeit to a lesser extent. But the "bubble" effect is still the same regardless of the cause.

Some believe that property prices throughout Australia are over inflated, and that an "adjustment" is due when the bubble bursts. If this happens (and I'm not saying that it will - I hope it doesn't), then the end result will be the same as what is currently being seen in Karratha.