This Made Me Laugh
This line cracked me up:
More than two-thirds of the government’s shortage estimate arises by including people who can’t afford housing, such as the homeless or those living in trailer parks, Mr Sayce said.
In most part, the belief is that there isn’t enough housing, but there’s this bit here:
Reserve Bank governor Glenn Stevens is among those flummoxed as to why homes are so pricey in a nation almost as big as the US, with just 22.7 million people.
“How is it that a country of our size – we are not short of land – how is it that we cannot add to the dwelling stock for the marginal new entrant more cheaply than we seem to be able to do,” Mr Stevens told a parliamentary panel in Melbourne late last month.
Now, what are we to make of that? Obviously the answer is people just want to live on coastal cities and the small areas along the coast, and not in that dirty big inhospitable bit in the middle people call The Outback.
Harry Dent Says…
Harry Dent has written some interesting books based on his observations to do with demographics and how they impact on the economy. He’s out in Sydney saying that the Bubble is overdue to take a hit, and most likely will cop it next year.
“Australia is probably the best place in the world to survive this, but we do think Australia will not escape as well as it did from the last crisis (in 2008),” Mr Dent told AAP.
At the centre of the coming debt crisis is real estate, the forecaster says.
“People in places like Sydney or Tokyo or Miami say, ‘Hey, real estate can never go down here, we’re a great place, everyone wants to move here, there’s not much land for development’, and what I say is that is exactly the kind of place that bubbles,” Mr Dent said.
“Outside Hong Kong and Shanghai, Australia is the most expensive real estate market in the world compared to income.”
Mr Dent said Australia’s house prices would return to late 1990s or early 2000 levels.
Driving all these changes is simple demographics, specifically the peak of the baby boomers’ spending, Mr Dent said.
That is all pretty simple and obvious, but will it really happen? This is exactly the scenario the Reserve Bank of Australia is trying to fight off, isn’t it?