Spara, I think we'd both agree that we don't agree with very...

Spara, I think we'd both agree that we don't agree with very much - particularly when it comes to politics!

In this one case, I agree with you. In my mind there is no doubt Australia is caught up in a real estate bubble. Basic economics makes that statement a fact. New home buyers in Melb / Syd / Brisbane (Perth / Adelaide don't count due to the economic depressions over there) now have to mortgage themselves up to the eyeballs to buy something even 45 min from the city. Thats maybe sustainable at the moment - provided those buyers keep their jobs. If they lose their jobs - their will be a flood of homes onto the market. When interest rates rise, there will be a flood of homes on the market. If there is a combination of both .... well that will be interesting!

Don't ever think house prices can't go down - Victoria in the 90's when Keatings interest rates went through the roof is testimony to that. The fact is the current generation haven't a clue what might come their way when the perfect storm arrives.....

If the government (and the labor party) keep spending like drunken sailors (with unsustainable deficits) then the rating agencies will down rate the countries credit worthiness causing the cost of debt to rise for everyone ... then watch what happens to that credit bubble ....