Perth median house prices went up like 38% from September 2005 to September 2006. Unsustainable, of course.
Across the country house price are in big mutiples to peoples wages. People are now using are larger percentage of their wage than ever on servicing debt and higher inflation. No wonder the savings rate is negative.
News commentators yesterday were happy wages rose by an average of 4% last year. Good for the politicians so they can "talk" down inflation but when oil is as high as it is and houses go up by 30% when a 4% rise in ones wage is not gonna cut it, now is it? Yet people buy properties and others think they will keep rising.
Westpac now offering no deposit finance. Of course they are, people can't afford 10% deposits anymore. People get stuck with huge mortgages at the top of the boom and media m0rons are encouraging this by saying prices will continue to rise more and more.
When people need to take huge loans to afford something that means they really cannot afford it. When people cannot afford something that means it is overpriced.
