There are a number of reasons why Australian property is in trouble:
- the Chinese bid is being increasingly choked off by China’s fight to prevent capital flight;
- macroprudential tightening has hit local investors;
- Western property markets are in deep trouble and will cause bad loan congestion at the banks;
- consumer sentiment is being hit by share market falls and increasing global volatility;
- the domestic economy outside of house prices and associated spending is in deep contraction and will remain that way for two more years keeping pressure on employment;
- supply is rising rapidly in Eastern boom markets;
- rental growth is at historic lows owing to zero income growth despite low vacancy rates;
- population growth is falling, and
- a global shock is approaching.
As price growth weakens, the supports will be:
