Property Prices Set to Stagnate - Australia Survey
MARK COLVIN: A survey of the real estate agents, investors and developers that drive property prices has provided further evidence that Australian home prices are set to flatline.
MICHAEL JANDA: Australia's most watched monthly home value index has shown prices fell for three months in a row over winter.
And that news has now fed through to a gloomy outlook for property prices next year.
ALAN OSTER: There's been a significant revision down in expectations. So, at the beginning of the year everyone was very optimistic and now basically people are staying flat.
MICHAEL JANDA: That's Alan Oster; National Australia Bank's chief economist, talking about its latest quarterly survey of more than 500 real estate agents, investors and developers.
What is going to burst this bubble? Tighter lending won't do it if the Chinese are still pouring money into the country. Real estate prices are set at the margin. So between these two forces we might have equilibrium. Homeowners with equity aren't suddenly going to get desperate to sell en masse, especially if they think things will get rosy again later, and the ones that do will get snapped up at the going price. So, for now, stagnation is not a bad call.
Are there significant possible triggers besides China?