With the maintenance of high immigration and State and Local Government placing considerable constraints on the supply of new housing the market is well protected. Interest rates are a potential bogey though. Funny how the prics that would burst the bubble seem to deny the existence of market forces other than irrational exuberance, and quote poor rental returns with great monotony. I wonder whether they appreciate that in conditions of limited supply and high prices rents have a tendency to increase?
I find the current situation appalling. Take for instance the Thursday night story on "A Current Affair" about the eviction of tenants from a 'slum' south of Hobart. This 'slum' consisted of old houses on large blocks of land, with a view of the ocean to the south and Mt Wellington to the north. The tenants weren't just concerned about losing their homes, but by the great shortage of low rental accommodation now that Tasmania is experiencing a population surge. Contrast this with the host of property programs showing hoards of people bidding huge sums for a hole in the wall in densely populated areas. No view, no nothing. Just a constant supply of new buyers guaranteed largely by immigration.
The real estate bubble is fun for some but disastrous for others, and exposes the claim that population growth increases prosperity for the lie that it is.
