More from Martin North:
Martin has been behind the curve on the rebounding market so is probably looking for an excuse to catch up. It’s still not clear to me that the ASIC judgement will end private class actions. Nor that ASIC will be forced to dump any of its HEM reform.
That said, you’d have to be blind Freddy to miss the extraordinary pace of erosion of the Hayne Royal Commission reforms so, in the long term, the ASIC HEM fail will lift lending versus baseline.
2020 now shapes a fascinating period for property. My base case is for global recession (that is 2% growth or below) and a nasty external shock for Australia, manifest in falling stocks and income via crashing terms of trade. It will hit an already weak economy.
But, fiscal mortgage stimulus is rolling down the pipe with more and more every day. Combined with the apartment quality control crisis, it could put a decent bid into existing housing.
Could we see a rerun of the 2009/2010 stimulus boom?
I still don’t think so. Immigration will fall as unemployment rises, plus wages and income will be dire. Weak growth for property prices remains the base case.
But you never can tell. The one guaranteed outcome is the Property Council PM will throw the kitchen sink at property.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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