Can we just simply build more houses / units to slow down the house price madness !!!

Originally posted by Infose: ↑

"The fact is that banks must make decisions about non-performing loans. You cannot expect them to just sit on outstanding loans for properties that have been vacant for prolonged periods and this is the case particularly with high rise in Melbourne and Sydney, but also thousands of vacant properties are on the books just ticking over."

https://sqmresearch.com.au/graph_vacancy.php?region=Vic-Melbourne&type=c&t=1

So vacancy rates are almost the same as in 2005, but in 2005 we were not coming out of a recession. Overseas students and
immigration will come back and for the forcible future monetary policy will stay accumulative.

“The ‘V-shaped’ nature of the recovery is everywhere to see – economic growth, the job market, retail spending and the housing market,” said Craig James, Sydney-based chief economist at CommSec.James expects the economy to rebound 4.2% in 2021"

Marcel Thieliant, economist at Capital Economics, expects GDP growth of 4.5% in 2021, “which implies that allowing for the slump in net migration due to the closure of the border, the economy will suffer no permanent drop in output as a result of the pandemic.”

SUPPORT STILL NEEDED Australia’s economy has performed better than its rich-world peers thanks to very low community transmission of COVID-19 together with massive and timely fiscal and monetary stimulus.Its economic output declined 2.5% in 2020, far smaller than a 10% drop in United Kingdom, falls of 9% in Italy, 5% in Canada and more than 3% in the United States."

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Overseas students and immigration will come back

not for a long time. 2023 has been foreshadowed.

and for the forcible (foreseeable?) future monetary policy will stay accumulative.

As I have said many times (and this is evidence-based, not theory based), the situation is complex and conditional.

The banks have had forbearance about not performing loans for a considerable time.

Whether they are in a position to stall foreclosures indefinitely, or even until migration and students come back is something only they know.
But it is reasonable to speculate that the time for extended tolerance is coming to an end.

Regardless of the RBA making loans cheaper, the banks have balance sheets and they won't tolerate non performing loans indefinitely. Under any theory, or with any cheap loans, it just doesn't happen. You need repayments to kick in on the capital borrowed.

Right now the whole thing is being propped up.

Already first time buyers are slackening off and investors are coming back into the market. I'm assuming they're steering well clear of the danger zones of high rise inner city and student housing. Which is a huge black hole. The rental vacancy rates are still very high. Is this sustainable?