A couple of quick posts 1. Interest rates are not always correlated to property price direction as Lespaul seems to suggest. Look at the USA and Japan. Infact If interes rates start falling hard its a sign to worry 2. At present high rates and flat to moderately weak property prices are causing some to sell rather than hold onto loss making assets 3. The comments someone made the rents are affordable due to property investors is also misleading. Rents are affordable compared to buying and paying interest. The low relative rents to property markets doesn't prove rents are affordable but rather property prices are way too high relative to rents. 4. Lastly there seems to be debate about how much property prices are falling. To me this needs to be looked at based on where we are in the economic cycle and how strong are economy is. To me the fact price are falling by about 10 percent in a period of full employment and a resource boom is telling. Price adjustment is rarely fast. Look at the USA or Ireland. The mid 30 and 40 percent falls from the peak have occured over a number of years. My view is Australia will be the same. Some people will sell quickly, others for the medium term, others even longer.I think with Australia it will be up the stairs and down a very slow moving elevator.
