The future of Australian property prices

[Beej]

2002?

I don't think so.

Probably 2005 were the early property bears.

Here's some articles from 2003 calling for a crash, and one also refers also to a similar article from 2001:

http://www.jenman.com.au/news_item.php?id=60
http://www.jenman.com.au/news_item.php?id=126

I remember these were picked up by the MSM and their were various newspaper articles at the time along the same lines. Mind you when it came to Sydney it was right to be bearish in late 2003 - however there was no great crash, just small falls and some stagnation, much like we are seeing right now.

 

[damien275x]

Problem with stagnation is that anyone leveraged will bleed money. Every year that passes where the home does not go up in value while they are paying interest = a loss, and a big loss. Most people cant deal with ongoing loss and will want out, especially once they see no signs of improvement for 5-10 years.

 

[young-gun]

Been ten years since this crash was suppose to happen good luck waiting on the next ten. GFC was suppose to bring it and still nothing to write home about, in fact they went up some more.

For prices to crash their needs to be a trigger that hits wages imo.
Rents are still sky high as well.

There is but only one trigger. and that trigger is demographics. the fact that we are the last bubble to pop merely shows that our boomer generation were born a bit later than all other nations.

As it has been said sooo many times, it is as simple as supply and demand. what causes demand? NOT sentiment, NOT confidence. 80% of the home owners dont have an effing idea whats going on in the global economy, nor do they care. no, what causes demand is whether people(an entire generation of people) need/want to buy a house or not. and the fact is they simply dont need or want too anymore.

so the trigger that you're looking for, is your next door neighbour, your independent grocery store owner, your friends, possibly even yourself if youre a boomer, who simply ahve no need, want or desire to purchase a house anymore, and its happening right now.

rising unemployment and falling wages are a bi-product of a slowing economy, not a cause. simply because people are not spending at the dizzying heights that they were in the boom times.

some may say that the slowdown is caused by too much debt. this is incorrect. the slowdown is caused by demographics, the intensity of it is caused by how much everyone is leveraged.

 

[Beej]

There is. We are one country, if prices differ significantly in one city to another, then people will relocate there, thus lowering the prices from where they came, and equilibrium will be reached.

You are very naive! It simply doesn't work that way, at least not in the short / medium term. If what you say is true then house prices should be roughly the same across all Australia's capital cities! Are they?? Have they ever been?? There goes that whacky theory.......

Housing bubble mechanics 101 pal:

[snip some naive youtube economics type drivel]

This happens everyone in Australia - in all cities, not just Melbourne. It has happened more in Melbourne than Sydney sure, but it absolutely happens in Sydney.

Again complete rubbish. The building rates in various cities at any point in time prove your theory to be bollocks.

Rents in Sydney are not going up - nor are they anywhere else.

Ok now you are just trying to be funny???

Only ONCE have sales volumes moved so low on that graph - in 1994, only ONCE - apart from the GFC. And as you already pointed out, we have had quite a lot of population growth since then!

Well there goes your 20 year comment....... and did prices crash after 1994? How about after 2008? Wake me if sales volumes fall say 30% or more lower than the 2011 level and you will sway me to the bearish side - as that would be virtually unprecedented, and would prove to me that things are "different this time".

Past performance is not an indication of future performance... You need to understand all factorors which led to those results - which you clearly do not, you just stick your head in the sand yelling "lalalala" and claim that because it happened once before it must happen now.

Ok so you ARE basically arguing "it's different this time" - but isn't that what the bubble deniers are meant to argue??? (Confused?).

Because we are one country, the the housing markets in our states are more or less identical, they work in an identical way and are regulated the same. This is in sharp contrast to somewhere like USA where you can indeed look at states as separate markets since there are such vast differences between their markets and regulations.

And secondly for the point which you allouded to - because it is possible for me to move from one city to another which has cheaper property, thereby balancing the situation out.

More evidence of your naivity with regards to how the residential property market in Australia and various cities actually DOES work. If you invest in other assets I sure hope you have a better understanding of market mechanics and history than shown with these comments about housing!

Stamp duties are state revenue, FHOB was a federal program. Also it is an incorrect statement to make as you cannot know exactly how many more sales were generated as a result, so you cannot know what proportion of that money wound back up in state government coffers.

FHBGs are administered by the states as well - states are all partially federally funded anyway - you know about COAG? Commonwealth state grants? GST income distribution? So it doesn't matter that stamp duties are a state tax. The bottom line is that the government does not actually stimulate housing - they suck revenue out of it and thus suppress the market. All FHB grants etc do is offset this a little for FHBs.

Can you cite me any example since the RBA was created, when it monetised debt? Are you aware that our federal government has spoken openly critisisng such behaviour?

Do you understand the difference between fiscal and monetary actions? My comment was about potential FISCAL actions by the government - you are talking about MONETARY actions. Please ready my comment again. The only constraints on fiscal action by government are political.

It is not a couple of thousand, the develops there are easily good for tens of thousnads of units a year. And not everyone wants to live close to the CBD - not to mention not everyone needs to.

Ummm - I don't think so. I'd check your facts if I were you. Regardless, just think for a second about how much new housing is needed with a population growing by 50,000-60,000 people every year?

No it isn't, and no they don't. I suggest you learn about our banking system.

I understand the banking system and the monetary system extremely well thanks. If you think you are so smart on this one then tell me - what happens to funds paid to overseas investors in Australian assets exactly? Do you think the $AU just disappears out of the system and country? Do you actually know how foreign exchange works?

First of all, not it has not. Second of all, the point is that it has gotten much much larger since the housing bubble began. And most of all, you fail to understand how bad of a thing that is.

Again you should check your facts. Australia has run a CAD for a long long long time. It has nothing to do with the so called housing bubble, unless we have had a housing bubble since the 60s? There is no correlation there at all. You could count on one hand the number of years out of the past 50 that Australia has registered a CA surplus. See figure 1 on page 7 of this RBA paper for a chart that goes back to 1960-ish: http://www.rba.gov.au/publications/rdp/2007/2007-02.html

Here's a chart plotting the CAD as % of GDP since 1980:



Do you see ANY correlation to house prices there? Any correlation to the rise in debt/GDP ratio that you claim proves a bubble?

Add to all this the fact that in recent times due to much improved terms of trade and trade surpluses etc the CAD has been trending lower in nominal terms and even moreso in % of GDP terms:

Doesn't exactly fit in with your theory does it? House prices rose 20% nationally over that period from 2007 - present!

Residex is well-known to be very unreliable and false. RP Data-Rismark is the only reputable housing data provider in Australia.

Of you are funny! Residex data doesn't say what you believe so it must be false? By the way RP-Data shows rising rents pretty much across the board as well.

 

[Beej]

Problem with stagnation is that anyone leveraged will bleed money. Every year that passes where the home does not go up in value while they are paying interest = a loss, and a big loss. Most people cant deal with ongoing loss and will want out, especially once they see no signs of improvement for 5-10 years.

Nah - rising rents fixes that issue. We saw this scenario play out from 2003-2007 in Sydney already; there was no rush for the exits. We can see this happening right now as rents are rising strongly just about everywhere while property prices fall a bit or stagnate.

 

[robz7777]

Nah - rising rents fixes that issue. We saw this scenario play out from 2003-2007 in Sydney already; there was no rush for the exits. We can see this happening right now as rents are rising strongly just about everywhere while property prices fall a bit or stagnate.

That's fine for those still working. Once people start moving into retirement they need income from their property, no doubt in many cases the rents are only break even once the tax deductible loan interest has been taken into account..

IMO people who bought in the 90's and earlier will be fairly comfortable but those who got in late (once their friends started taking about their investment properties) will be the ones looking to exit the market as their cashflow gets squeezed.

 

[Beej]

That's fine for those still working. Once people start moving into retirement they need income from their property, no doubt in many cases the rents are only break even once the tax deductible loan interest has been taken into account..

No that doesn't make sense? A property investment is either cash-flow positive or it is not. Once you reach the point where rent >= costs (interest, strata, rates etc etc), then it doesn't matter what income you earn / what your marginal tax rate is. In fact earning no / low income is better as you will pay less tax on the cash flow surplus from your investment property. This is what nearly all long term PIs actually aim for, especially those looking to fund their retirement from such.

Having income and high marginal tax rates only helps during the period when the investment is actually negatively geared, as the higher your marginal rate the more of the shortfall is picked up by your tax reduction.

 

[Bill M]

That's fine for those still working. Once people start moving into retirement they need income from their property, no doubt in many cases the rents are only break even once the tax deductible loan interest has been taken into account..

Hi robz, I am one of those guys who has moved into retirement and I live off my IP rental income. Usually most people retiring do so once that IP is pretty much paid off. I am in this position and currently earn about 3% clear after all expenses and after tax. It may not sound like a lot but it is enough to pay all of our living expenses.

What you must remember is the very low taxes low income individuals pay. Yes I know the first $6,400 is tax free but did you know about the low income tax offset? In effect it allows an individual to earn around 18k per year tax free. So with me being able to have 18k tax free and my wife having 18k tax free that gives us a 36k a year salary or $700 p/w tax free, not bad for doing nothing. So the point I'm trying to make is that net 3% per year is safe tidy little earner and any future capital gains on that property will be a bonus. I also wish to advise all posters, I have never ever lowered rents, they have only gone up and mine again went up $10 p/w last year. There is no shortage of tenants on the Northern Beaches in Sydney where my property is, cheers.

Link to low income tax offset calculator here.

 

[MrBurns]

Hi robz, I am one of those guys who has moved into retirement and I live off my IP rental income. ]

Thanks for sharing that Bill M, residential rentals in good locations will always be ok, commercial industrial however is another matter, volatile like shares in a way.

 

[Bill M]

commercial industrial however is another matter, volatile like shares in a way.

Yes I know, I held a few listed REIT's before and during the GFC. I have consolidated the lot of them and ended up just buying into a ASX 200 Property ETF. They are still well down since their peak in 2007.

 

[lenny]

I have a few questions for the property bears on this thread.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

Look forward to hearing your responses.

 

[MrBurns]

I have a few questions for the property bears on this thread.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

Look forward to hearing your responses.

1/ 30% or more.

2/ in TD's

3/ It's happening now but about 12 months from now for it to bottom is my guess.

 

[Dowdy]

I have a few questions for the property bears on this thread.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

Look forward to hearing your responses.

1. 25%

2. I run an online business

3. Saving up money to buy a house with at least 50% deposit. Gets easier every year with falling prices

 

[Starcraftmazter]

You are very naive! It simply doesn't work that way, at least not in the short / medium term. If what you say is true then house prices should be roughly the same across all Australia's capital cities! Are they?? Have they ever been?? There goes that whacky theory.......

Yes it does, it's called labour mobility. And yes, they are roughly the same. The price to income ratios are extremely high in all major cities in Australia. Look at Germany and they are literally 3-4 times cheaper. Now that's a difference in prices which does not exist in Australia.

Again complete rubbish. The building rates in various cities at any point in time prove your theory to be bollocks.

It is not bullocks, you can clearly see housing commencements rose and then moved to the highest point in Australia's history after the bubble started in around 1990. After the 2000 slowdown housing commencements moved to a very high level until the GFC, after which they again bounced up very strongly even as our population growth ground to the slowest level in around a decade.

Ok now you are just trying to be funny???

Maybe you should stop making stupid comments and pay attention to the evidence. Like those rent graphs I produced.

Well there goes your 20 year comment....... and did prices crash after 1994?

Completely different time, completely different circumstances.

How about after 2008? Wake me if sales volumes fall say 30% or more lower than the 2011 level and you will sway me to the bearish side - as that would be virtually unprecedented, and would prove to me that things are "different this time".

Why 30% lower than the lowest point in the last 20 years? How arbitrary. We are already at panic levels. And yes they did began to crash after 2008 - and the government poured rivers of "stimulus" to prop up the market.

But I already went over this - it didn't work, and house prices have now fallen even further than during the GFC while the government is significantly indebted.

Ok so you ARE basically arguing "it's different this time" - but isn't that what the bubble deniers are meant to argue??? (Confused?).

This time has never come before, so I don't know what you are talking about. Never in the history of humanity have we had a credit bubble burst the size of the current one. Never in Australia's history have we faced a demographic bomb. Never in Australia's history has housing been more unaffordable. Never in Australia's history have we had so much mortgage debt per capita.

This time is not different - because this time has never occurred in the past.

More evidence of your naivity with regards to how the residential property market in Australia and various cities actually DOES work. If you invest in other assets I sure hope you have a better understanding of market mechanics and history than shown with these comments about housing!

More pathetic rhetoric from you, and zero substance.

FHBGs are administered by the states as well

I said FHOB not FHOG.

The bottom line is that the government does not actually stimulate housing - they suck revenue out of it and thus suppress the market. All FHB grants etc do is offset this a little for FHBs.

Yes they do, that is what they have always done.

Do you understand the difference between fiscal and monetary actions? My comment was about potential FISCAL actions by the government - you are talking about MONETARY actions. Please ready my comment again. The only constraints on fiscal action by government are political.

You show that you do not understand what you are talking about. Our government does not have a reserve currency like the US or Japan. It cannot borrow whatever it wants - it would require the RBA to monetise it's debt - and that is indeed monetary policy. Our reserve ban is unlikely to ever do that.

Ummm - I don't think so. I'd check your facts if I were you. Regardless, just think for a second about how much new housing is needed with a population growing by 50,000-60,000 people every year?

Wow, you really know nothing do you? "Ummm I dont think so check your facts, regardless" - just listen to yourself. Maybe you should go down there and talk to the developers to see just how much capacity they are building.

As for 50-60k people per year, that is absolute nonsense. The vast majority of the people immigrating to Australia go to WA and to a lesser extent QLD to work in the mines, NSW population growth has actually slowed by about 30% since the GFC. It's obvious that births do not amount to housing demand for a very long period of time - by which time baby boomers will be gone, and house prices would have fallen by 60%.

For all intents and purposes, Sydney's population growth is fairly flat.

I understand the banking system and the monetary system extremely well thanks. If you think you are so smart on this one then tell me - what happens to funds paid to overseas investors in Australian assets exactly? Do you think the $AU just disappears out of the system and country? Do you actually know how foreign exchange works?

I do but you don't (which you have already demonstrated). Australians paying interest to the foreign banks goes to foreign banks - that money does not stay in Australia. Our bank borrow overseas in overseas currency.

Same principal for the stock market. Our miners - the biggest of which are listed around the world pay dividends to overseas investors in overseas currency.

All that money is just leaving Australia. That is the definition of a current account deficit.

Here's a chart plotting the CAD as % of GDP since 1980:

And you can clearly see it has blown out as the bubble grew - once again, thanks for proving my point.

Add to all this the fact that in recent times due to much improved terms of trade and trade surpluses etc the CAD has been trending lower in nominal terms and even moreso in % of GDP terms:

Nominal terms are irrelevant, all nominal measures are a joke.

Of you are funny! Residex data doesn't say what you believe so it must be false? By the way RP-Data shows rising rents pretty much across the board as well.

No, there's nothing funny about it - it's a well known fact that Residex is very unreliable. Macrobusiness has covered this in detail.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

1. I would deem 30% as enough for a crash, but I think it will crash much further than that.

2. Stock market, various derivative trading instructs (short term only).

3. If by 2020 house prices don't fall by 40% real from peak then I'm out of this country.

 

[lurker123]

I have a few questions for the property bears on this thread.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

Look forward to hearing your responses.

1) 30% or more

2) Shares and options, in theory, if you know what you are doing you should be able to profit from all kinds of markets. Due to the current economic instability its risky since there is a chance that the market may drop even more, on the other hand there is a chance that the current situation is near low, so who knows, 5 years from now you might be able to sell at 100% capital gains. The other factor is you can short shares and options. A lot harder to get into shorting property unless you can get into the credit default swap action.

3) Up to the point where i am so filthy rich that it doesn't matter that I might make a loss on property. A lot of people have their savings in their place of residence/ family home. Currently i have no plans on where or which country I want to live in when I retire so I couldn't care less that I don't own my place of residence. My savings rather than parked in the family home would be invested in quality businesses. Obviously if a crash does occur it is in my interest to have a investment property or 2 provided i have the necessary capital.

 

[Beej]

Yes it does, it's called labour mobility. And yes, they are roughly the same. The price to income ratios are extremely high in all major cities in Australia. Look at Germany and they are literally 3-4 times cheaper. Now that's a difference in prices which does not exist in Australia.

You are delusional! So you think that houses in Hobart are just as expensive as houses in Sydney do you??

I've made most of my points to you before so I;m not going to go over everything again, but I am just going to highlight some of the complete bollocks you just wrote:

Maybe you should stop making stupid comments and pay attention to the evidence. Like those rent graphs I produced.

Here's the chart on rental growth again for you:

.

That chart is from Alan Kohlers website and was produced by ANZ based on ABS data.

There is so much data showing rising rents over the past few years it is not funny. You are in complete denial if you think rents have not been rising. They were up 16% in Perth in the last 12 months! 6% in Sydney! Up in nearly every capital city across the board.

But I already went over this - it didn't work, and house prices have now fallen even further than during the GFC while the government is significantly indebted.

Fact - the Australian government has the LOWEST public debt relative to GDP of every country in the G20. You need to take your brown coloured glasses off!

This time has never come before, so I don't know what you are talking about.

This time is not different - because this time has never occurred in the past.

Yep, so "it's different this time" - got it. I'll talk to you in 12-18 months if you are still around, and you will be proven wrong just like all the posters in 2008 who spouted the exact same stuff back then.

You show that you do not understand what you are talking about. Our government does not have a reserve currency like the US or Japan. It cannot borrow whatever it wants - it would require the RBA to monetise it's debt - and that is indeed monetary policy. Our reserve ban is unlikely to ever do that.

Complete bollocks - and since when does Japan have a "reserve" currency? Only the $US is considered reserve because world commodities are priced in and traded in $US. What Australia DOES have (as does US, Japan, UK etc, but Greece and Ireland do not) is our own SOVEREIGN currency. Australia can borrow / create as much of its sovereign currency as it sees fit. The only constraints are political on the fiscal side, and the risk of inflation and foreign exchange value on the monetary side. If you don't understand this then you will never get how the economy actually works, and what Treasury and the RBA actually try to do behind the scenes to maintain economic growth.

Wow, you really know nothing do you? "Ummm I dont think so check your facts, regardless" - just listen to yourself. Maybe you should go down there and talk to the developers to see just how much capacity they are building.

No - I KNOW you are wrong. I notice you can produce nothing to back your claim of "tens of thousands of new units in Zetland over the next few years"?

As for 50-60k people per year, that is absolute nonsense.
......
It's obvious that births do not amount to housing demand for a very long period of time
......
For all intents and purposes, Sydney's population growth is fairly flat.

You are so demonstrably wrong on all counts here it is getting beyond a joke! This article (http://www.smh.com.au/national/sydney-drags-the-chain-on-growth-20120330-1w3lr.html) bemoaning the "slowdown" of Sydney population growth because it's population grew by "only" 60,000 last year, and 75,000 the year before is wrong is it? Really Sydney's population is flat is it?

"Sydney's population rose by almost 60,000 in the year to June, more than 15,000 less than 2009-10."

As for babies and housing demand, you are probably too young and wet behind the ears to realise, but when people have kids, they usually want to move to a bigger house! Natural population growth creates HUGE housing demand!

Anyway enough arguing with you - I know I will not change your mind and you will maintain your extreme views spread by reading to much Steve Keen and other rubbish like on Macrobusiness etc. It's just that someone has to point out the huge factual errors in half the stuff you post. Will see who is right in 12-18 months from here, assuming you are still on this site with that handle. If you really want some interesting reading go back through the archives here and read the housing threads from 2008/2009.

 

[Starcraftmazter]

You are delusional! So you think that houses in Hobart are just as expensive as houses in Sydney do you??

No, that is not what I said. Furthermore, it is not a good argument to compare two capitals that are so drastically different in size. It is best to compare capitals like Sydney, Melbourne, Brisbane since they are the biggest. Then would come smaller capitals, etc.

Furthermore, the point I made was the price to income ratios are relatively even between those cities - compared to cities in other countries. This is true.

Here's the chart on rental growth again for you:

Yes, it shows rents have risen faster than CPI - it supports the housing bubble thesis. I do not understand what your point is.

There is so much data showing rising rents over the past few years it is not funny. You are in complete denial if you think rents have not been rising.

Two posts ago, I showed you two graphs of official rents in real terms, and it is pretty clear that they have been flat for the last few years. There is no debate to be had here.

Fact - the Australian government has the LOWEST public debt relative to GDP of every country in the G20. You need to take your brown coloured glasses off!

Every country and it's finances are different. Every country is at whims to a different monetary situation, and thus their capacity to borrow is different. You seriously do not understand economics if you think every country is the same in terms of being able to borrow money.

Yep, so "it's different this time" - got it. I'll talk to you in 12-18 months if you are still around, and you will be proven wrong just like all the posters in 2008 who spouted the exact same stuff back then.

It's not different - please, continue to think your head in the sand and ignore the situation. Nobody who said housing was going to crash in 2008 was wrong one bit.

Complete bollocks - and since when does Japan have a "reserve" currency?

Since investors are quite happy to bid up the yen even as Japan stands at over 200% debt to GDP.

Only the $US is considered reserve

No, that's not really true.

because world commodities are priced in and traded in $US.

And that's not entirely why either. As I suspected, you only pretend to have a clue.

What Australia DOES have (as does US, Japan, UK etc, but Greece and Ireland do not) is our own SOVEREIGN currency. Australia can borrow / create as much of its sovereign currency as it sees fit.

Are you serious? Can you please describe to me the process by which countries create money, because I honestly do not think you understand it. I think you just read a lot of blogs and think you understand economics.

So tell me, if Australia wants to "create" more money to spend - where is it going to get it from?

No - I KNOW you are wrong. I notice you can produce nothing to back your claim of "tens of thousands of new units in Zetland over the next few years"?

Go and look for yourself.

You are so demonstrably wrong on all counts here it is getting beyond a joke! This article (http://www.smh.com.au/national/sydney-drags-the-chain-on-growth-20120330-1w3lr.html) bemoaning the "slowdown" of Sydney population growth because it's population grew by "only" 60,000 last year, and 75,000 the year before is wrong is it? Really Sydney's population is flat is it?

This is a typical nonsense article by our real-estate driven press to make people like you think there's a housing shortage, and rush out to bid up property prices. If it was true, it would mean that Sydney was responsible for 1/3 or more of the population growth of the whole country. They then go on to say that Melbourne grew even more. That means Sydney and Melbourne combined are 3/5th. This leaves very little for WA and QLD which is where the immigrants are going.

As for babies and housing demand, you are probably too young and wet behind the ears to realise, but when people have kids, they usually want to move to a bigger house! Natural population growth creates HUGE housing demand!

People do not move residences with every new child they have - and it is certainly not necessary.

Anyway enough arguing with you - I know I will not change your mind and you will maintain your extreme views spread by reading to much Steve Keen and other rubbish like on Macrobusiness etc. It's just that someone has to point out the huge factual errors in half the stuff you post. Will see who is right in 12-18 months from here, assuming you are still on this site with that handle. If you really want some interesting reading go back through the archives here and read the housing threads from 2008/2009.

You are hilarious, please continue.

 

[young-gun]

I have a few questions for the property bears on this thread.

1. In percentage terms what do you guys define a crash as?

2. Where have the property bears got their money invested now?

3. How long are you prepared to wait for this property crash to happen?

Look forward to hearing your responses.

1. enough to make the 6pm news

2. cash

3. if prices dont fall by more than 5-10% in the next 12-18 months i will be reassessing my situation. if RE makes a bigger move than that either up or down sooner than 12 months then naturally my game plan will change. its really a month by month sorta game.

 

[moXJO]

There is but only one trigger. and that trigger is demographics. the fact that we are the last bubble to pop merely shows that our boomer generation were born a bit later than all other nations.

As it has been said sooo many times, it is as simple as supply and demand. what causes demand? NOT sentiment, NOT confidence. 80% of the home owners dont have an effing idea whats going on in the global economy, nor do they care. no, what causes demand is whether people(an entire generation of people) need/want to buy a house or not. and the fact is they simply dont need or want too anymore.

so the trigger that you're looking for, is your next door neighbour, your independent grocery store owner, your friends, possibly even yourself if youre a boomer, who simply ahve no need, want or desire to purchase a house anymore, and its happening right now.

rising unemployment and falling wages are a bi-product of a slowing economy, not a cause. simply because people are not spending at the dizzying heights that they were in the boom times.

some may say that the slowdown is caused by too much debt. this is incorrect. the slowdown is caused by demographics, the intensity of it is caused by how much everyone is leveraged.

Howard was pouring people into this country through immigration and not much has changed with labor. Remember the 'Big Australia' plan of doubling the population.

Recent research by Comsec economist Craig James has found that Generation Y is now Australia's largest demographic. How are you keeping up with this changing world?

Based on population data from around Australia, Gen Y has emerged as Australia's largest demographic with 4.67 million people. Generation X has also grown to 4.6 million. And, the Baby Boomer demographic is shrinking, falling by 6,000 to just 4.11 million people.
To clarify who's who:
Gen Y are those people born 1976 to 1991
Gen X are those people bord 1961 to 1976
Baby Boomers are those borm between 1946 and 1961

 

[Starcraftmazter]

Howard was pouring people into this country through immigration and not much has changed with labor. Remember the 'Big Australia' plan of doubling the population.

Well Gillard is against big Australia isn't she?

The net O/S arrivals have come down drastically since the LNP peaks around 2005, and are now about half of what they were. I don't think it's something to worry about considering the fast pace of construction activity in Australia and the massive oversupply in Melbourne, not to mention a lot of these are immigrants flown in by the mining companies.