Have posted a bit about this before, but thought worth covering again. Gold and Silver are on the rise against housing, meaning that if you are holding Gold and Silver it is getting cheaper to buy a house so long as you are prepared to exchange it at some point.
I suspect this trend will continue and that once again (as was the case in 19980), that 100 ounces of Gold will buy you a median house in most capital cities.
Covered in a short blog yesterday (with some charts on Sydney/Melbourne):
You may have noticed a recent surge in the number of commentators/articles/blogs making note of Australia�s housing bubble. Jeremy Grantham (US Investor and co-founder of global investment management firm GMO) said in an interview earlier this year that prices would need to come down 42% to return to the long term trend, The Economist magazines latest global survey found that Australian property was 61% over valued, even Mike Shedlock (or Mish, registered investment advisor representative for SitkaPacific Capital Management) has mentioned that Australia�s housing bubble exceeds that of the recently collapsed US bubble.
There are several measurements we can look at to gauge whether house prices are over valued or under valued. The Economist has used a measurement of purchase price vs rents, Jeremy Grantham used price vs multiple of income and this blog takes a brief look at house prices measured in Gold & Silver.
