grindstone cowboy,
That is not true! I looked into it myself a while ago and plotted it out from records on the ABS (Australian Bureau of statistics) website http://www.abs.gov.au/
in 1960 you could buy for 3 years wages
in 1973 you could buy for 3.5 years wages
in 1982 you could buy for 2.5 years wages
in 1990 you could buy for 4.5 years wages
in 1996 you could buy for 3.5 years wages
Thats 40 years of small cycles maintaining the same cost, not experiential growth!
in 1999 the Australian Tax Office changed CGT to 50% and house prices double through to 2001 hitting 7 years wages
(Shares also boomed from the incentive given for investing from the same year which you can see on the ASX)
It then remains volatile (around 7 years wages) until sub prime then immediately jumps again from the date the RBA slashing the cash rate and Rudd did his mammoth first home buyers boost. House prices have been the same since with just a small dip in the middle between then and now.
If house prices went up because of cheap credit and incentives, then when these are both removed (ie home loans go back to normal levels) it should return back to the trend line.
The trend line looks like its 4 years wages to me.. so that is a 50% fall to return back to normal
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