In contrast, if the price reverts to the PoC you?re looking at...

In contrast, if the price reverts to the PoC you?re looking at around a 15?20% drop, and potentially a 40% drop or more if the index reverts to the lower end of the distribution.

In other words, the best chance of making a buck on the housing market right now is to short sell it!

The way we see it, a move back to the PoC for the housing index is inevitable ? Murray would never say that, he?s far more cautious with his words. But we would. This I?m afraid is the best-case scenario for property spruikers.

The worst-case scenario is a 40% drop that would wipe most spruiker portfolios from the face of the earth.

And if you look at the latest statistic from Louis Christopher at SQM Research you?ll be astounded at how the spruikers have been caught with their trousers down after years of claiming there?s a housing shortage.

Here?s what Mr. Christopher?s latest note had to say:

?Figures released last week by SQM Research revealed that residential listings for April 2011 rose by 14,035 to 370,638 nationally ? a 3.9% increase from March 2011 and a 68.7% increase when compared to the same month (April) in 2010. This is an increase of 151,000 year-on-year.?

Yoiks! A 68.7% increase in the number of properties on the market. That? is? huge.

Now, the clever little spruikers will say, ?Ha, but that?s a 68.7% increase in demand as well because these people will need to buy somewhere else to live, so neh!?

Not so. Our bet is the majority of those listing their house for sale will be super reluctant to buy anything before they?ve sold their current home. And you can?t blame them.

If they?re sitting on next-to-no equity in the value of their home, the last thing they?ll want is to double their mortgage commitment by buying a second home before they?ve sold the first.

The consequence? It?ll be rich pickings for patient buyers. Because what you?ve now got is the bursting of the housing-shortage myth.

We?ve said all along the housing shortage was nothing more than a cleverly orchestrated ruse by property spruikers to con gullible buyers into thinking they should buy before it?s too late.

Coupled with the nonsense about the Australian population doubling or tripling in size within the next forty years, buyers took the first-home buyers? bribe and jumped head first into a debt and negative equity trap.

So now they?re bleeding from the eyes as they struggle under a weight of spruiker-induced debt, competing to sell their home along with the other 370,637 houses on the market.

A number that?s almost certain to rise as each month passes.

What then for the seller who has already seen 219,637 competitors turn into 370,637 competitors? What will he or she do when the competing houses for sale number 470,637 or 570,637?

Will he or she still maintain their house is worth more because the Joneses sold their house for less two years ago and the Jones?s house was nowhere near as good as theirs, ?Look at all the money we spent on granite kitchen benches and a home theatre!?...article continues


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