and if the bubble in 10%?? of Australia's postcodes does eventually burst then what happens? Those that are not buying now flood the market when a drop of 15-20% occurs.
Instead of waiting for it to happen I would think the best option for first home buyers is to buy a property away from their comfort zone where there is less chance of a capital growth, which lessens the risk of a capital loss, and where the gross return is above 6.5%. they can then be building equity while they wait for a drop and will have even better buying power/leverage at the bank when it happens right?
