The government does love it's housing though...can't let house prices drop now can they?
I try and get to the logic of it all;
Global economic crisis hits, house prices fall (a small percentage). This is a logical outcome (people are afraid and do not want to amass debt)
Government quickly increases FHBG and the RBA quickly drop interest rates, house prices rise. This is also a logical outcome (brings new people into the market and they can borrow more money)
The logical outcome if you take away most of the FHBG and raise interest rates is that prices either stay the same or go down. Most likely the latter.
What are the odds the Australia is the only economy that can sustain it's property price bubble?
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my predictions for 2010, page-6
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