As much as I want to be selfish and buy my new home at a 50% reduction to now, say $300K down frm $600K, in reality this will not occur. No-one would wish this on the market given what we knwo will happen to the economy for a long time in the future.
Some studies were done a little while ago, Australian Bank's could withstand a gross 20% reduction in prices OK, and in a pinch a 40% reduction. Any more game over for NAB, WBC, ANZ and CBA. This is not a good thing.
Realistically a 20% reduction in prices from where we are now, and even this will take 2-3 years to play out. 25% max loss from now.
I'm not buying now, I'm expecting to wait around 3 years before buying. I figure I will buy $100K less in 2014 than now.
I may even buy a US 1 bed unit for maybe US$40K, see how I go. Depends on research and US exchange rate moving forward. Gives me an excuse to go to an NFL game and some sightseeing.
