A secret treasury economic brief to the government warns Australia’s high level of household debt and Australian bank’s reliance on overseas funding are significant risks to the Australian economy. The brief, known as the “Red Book” was made public on Friday after many freedom of information requests. “Highly indebted households, …
Latest data from the Melbourne Institute show the number of households that are debt free has fallen to 9 year lows with only 36.2 percent of households holding no debt in the September quarter, a record for the survey which began in 2001. Recent ABS data shows Household debt has …
Borrowers will need to brace themselves for a raft of rate rises next year as the economy strengthens according to a former senior Reserve Bank economist. Paul Bloxham, the newly appointed HSBC chief economist for Australia and New Zealand has predicted the RBA will bump up the official cash rate …
You have heard it time and time again. A small miracle has occurred down under, we have dodged the biggest financial crisis since the great depression and are on the road to recovery. But are we? Are we really in the Great Impression – The impression that everything is a …
After dodging the biggest financial crisis since the great depression, Australian lenders are starting to return to subprime lending practices, not seen since the start of the GFC. Mortgage House will start offering 105% percent housing loans next month after applications for its 99% LVR loan introduced last month has …
OECD Chief Economist, Pier Carlo Padoan has said “Recent high-frequency indicators point to a slowdown in the pace of recovery of the world economy that is somewhat more pronounced than previously expected” and that policy makers may need to extend or bolster stimulus programs. This comes as governments around the …
The Sydney Daily Telegraph has reported banks are refusing to offer bridging credit as the risks start to mount. Bridging loans are used by homeowners to buy a property before they sell their existing one. But with homes taking longer to sell in a weak market, and selling at lower …
Under the Coalition Government’s housing policy, struggling renters on public housing lists will be given rental vouchers to help pay more for their rents in the private sector. According to data from Australian Property Monitors, medium rents increased by only 1 percent in the June quarter with many capital cities …
Real estate experts in the U.S. suggest houses are now a bad investment, indicating there is no law to say real estate will appreciate in value. For a century prior to the great housing bubble that started in the 1990’s, house prices only appreciated in line with inflation. This ensured …
Morgan Stanley chief strategist Gerard Minack has today warned clients that Australia’s housing bubble is 40 percent over fair value and could be popped if banks tighten credit or the loss making landlords start to sell. He claims investors have become “Ponzi borrowers”, relying on capital gains to service massive …
Nobel Prize-winning economist Joseph Stiglitz told a Sydney forum on Friday that “There is the beginning of a cause of concern, and it would probably be prudent to take some actions” on our housing bubble. Professor Joseph Stiglitz was a former world bank chief economist. His predictions could be on …
Yesterday, the China Banking Regulatory Commission (CBRC) announced stress testing of banks with modeling to include a 60% price fall of house prices in China’s 7 top tier cities including Beijing, Shanghai and Shenzhen. Today, it has been reported the stress tests will not only include banks, but extend to …
New home sales have continued a downwards trajectory, with the Housing Industry Associating reporting its home sale index falling 5.1 percent in June. This follows a 6.4 percent drop in May. Melbourne recorded the largest falls, sliding 10 percent for the month. Western Australia and Queensland trailed, falling 5.2 and …
We are continually told that a shortage of houses means prices will continue to out pace the buyer’s ability to afford them, and that money grows on trees. However two other shortages are starting to show its head in Australia’s property bubble. The shortage of greater fools – someone that …
According to research conducted by the National Australia Bank, expectation of house asset price rises have fallen around the country. NAB chief economist Alan Oster said ”There has been a very big change in expectations.” Melbourne lead the falls with most respondents predicting prices will only increase 0.7 percent over …
As Australia progressed through the stages of the housing bubble, all range of excuses were invented to support the unsustainable credit binge on property. We were told if we look back over 100 years, houses double every 7 years. Then there was a shortage of houses, high immigration and the …
Auction clearance rates are continuing to decline around the country, with rates significantly lower that the same time last year. According to Australian Property Monitors, Sydney had a clearance rate of 49.8 percent last weekend, while Melbourne recorded 55.6 percent. For the same period last year, Sydney cleared 70.5 percent …
The Daily Telegraph has revealed the Federal Government has decided to boost the contribution threshold on its First Home Saver Accounts. For the 2010-11 tax year, if a first home saver contributes up to $5,500 to their account, the government will chip in the same 17% or $935 on $5,500. …
The latest rental price data from RP data shows rents for houses have remained flat over the June quarter. Hobart recorded the largest falls in rents, falling 1.5 percent. Melbourne was close behind at 1.4 percent, while Brisbane, Adelaide, Perth and Darwin recorded no change. Sydney witnessed a rise of …
According to Kenneth Rogoff, the former chief economist of the International Monetary Fund and Harvard University professor, China’s property market is beginning a collapse. “You’re starting to see that collapse in property and it’s going to hit the banking system” Xu Shaoshi, People’s Republic of China’s Minister of Land and …
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