Hi folks
our property market has held up as our economy has had a stellar run, just under two decades , very much in line with the length of the property boom. If you go overseas you will see that property markets collapse in line with big economic slowdowns , japan , USA , Spain , Ireland , Greece , etc all associated property corrections due to combination of leverage , high prices and unemployment . The ingredient that is missing in Australia is the slowdown / unemployment . When that does come, as surely as night follows day , the property market will correct . Australia and it's citizens have truly forgot that things can be tough . There are pockets doing it tough , but overall we are still doing very well .
The rent vs buy argument needs to also factor in potential capital losses, transaction costs of buying and maintenance costs of holding . As for negative gearing - it's unwise to base the viability of an LT inv on a tax concession , I agree it will be hard to remove but never say never
