how far will house prices fall?, page-18

IMO Bolide is now posting the most rational text on this subject.

But the chart posted by BigGambler via post 31854 27/07/10 17.45 gives some clues.

I don't see us ever geting back to the 3.0:1 ratio (house to salary) but I do believe we have to get back to a say "goldilocks ratio where every one is happy" In the oil industry $70/80 per barrel is the goldilocks price i.e. both producers and consumers are happy.

In Oz. housing, we need to get back to at least the 6:1 ratio, still double what it was in the 60's 70's and 80's.

This implies a drop of about 23% i.e back to roughly 2006 levels, or, in the land of utopia, house prices to remain static (no drop) for four/five years whilst wages climb for the same period, but who believes in Goldilocks, I wish I could in my old age.