imo we have been in a residential property bubble since the pill appeared.
When will it burst? No idea.
But - how about this.
Can we say that property has been doubling every say 10 years?
Is that fair enough?
If yes ---------- then ok.
Can we also say that inflation atm is around a couple of percent - give or take, so we are told.
OK, if we agree with those two things then just how long can those two things coexist?
Property doubling every 10 years and inflation at 2% to 3%.
Just how long can that go for?
There ain't a new pill coming.
The ONLY way that growth can keep up with low inflation is if our household income heads north dramatically.
And with low inflation - the ONLY way household income can head north dramatically is for the number of people in the house to increase - ie. more wage earners in the home who pay for housing.
can we see that happening?
Perhaps, but that is going to be one hell of a cultural shift.
OR ------------------ growth stops.
Remember these graphs --------- remember when the pill came out?
I say again --------- there ain't no new pill coming.
