Fanning talk of housing collapse

Hi all

Just occurred to me that it might be in the governments interest to fan fear re housing collapse in support of getting re-elected. What is probably just a correction that had to come in markets that were running a bit hot is now a re-election tool. Given Shorten's support of negative gearing they would be stupid not to fan insecureity re a collapse dont you think? Are they doing all they can in the media to increase these insecurities?

 

Why ?
This has all been caused by the failure of the government and APRA to do their jobs properly years ago.
Tony Abbott said years ago when he was elected that the banking industry should self regulate and stripped it of money.
Which government ministers said people just need to go out and get a better paying job or move to more affordable regional areas,and kept on kicking the can down the road.
The current government consistently refused to hold a RC into banking, and it was the banks that actually had to ask the government to investigate themselves.
This current problem with Sydney and Melbourne has been caused by a do nothing approach , and then leaving it to late before addressing the issue ,which has just made the problem far worse as house prices seriously overshot the mark, due to slack lending practices and to many IO loans being written out , all at the same time as wage growth stopped in its tracks and the RBA started droping Interest rates, although this started to happen under the Labour government.
It just took everyone a few years to figure that wage growth had stalled, and that increases the bank risk ,as they assume your pay will rise healthily every year and it becomes easier to service your loan.

 

No government is going to publicly state that the economy is at imminent risk of going down the toilet (which is what a proper house price crash would coincide with). Apart from the fact that it would be a self fulfilling prophecy, talking about that sort of instability is not a vote winner.

 

Perhaps yes, as every group has it's own political agenda.
But the economics behind a crash is also at play.

 

Nah, it’s just the banks driving the economy down the toilet to punish the current government (LNP) and the next government (ALP) for pushing for a Banking Royal Commission

 

The average punter in the street hasn't got a clue....
They will go for the best/worst headline or a good sausage sizzle on election day.....

People talk of a big bust....but I ask them where??? No answer.

That said - the problem of apathy towards our governance is rife...."You get the government you deserve"......let's vote sensibly.

 

I don’t expect a housing “Collapse”. Correction, probably; stagnation, possibly.

Sure, Sydney and Melbourne well and truly overshot long term pricing trends and are inevitably correcting. Changing loan terms and conditions are reining in the recent years of often free-for-all, dodgy borrowing/lending practices (usually from both sides), probably not before time.

We made money from property investment despite 20% minimum deposits and 16% interest rates. Back then, buying 5 properties in a year was just about impossible, as it probably will be again. But slow and steady is still possible, and often wins in the long run.
Marg

 

(this is From another thread on PC)

47 Portman St, Zetland.
Bought for $1.52 May 2017
passed in a couple months ago,
then sold last weekend for $1.15 milion.
That is a 370K drop, in 18 months losing 25% of the value.
Unfortunate for the buyer though.

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