The reasons why the property bubble in Australia is at risk of bursting are numerous.
-Clearance rates are low. We therefore have an OVERSUPPLY of houses on the market at present, not a SHORTAGE. -Property Price to income ratio is at all time highs. -The world macroeconomic environment is ridiculously unstable. -Rental yields are on average, very ugly. -Data is showing property prices are already on the slide -Banks do not have much more room to move interest rates downwards due to shortage of available loan capital resulting in tight margins. -Unemployment is near all time lows (capacity) which means, the only way is up. -Divorce rate is highest in the world, resulting in an UNDERSUPPLY of dual income families and hence lesser demand for overpriced houses. -There has been a tripling in household indebtedness since 1990.
