Home Prices in Sydney & Melbourne Spiral Down, Bust Spreads



Posted by Ed 3 mths ago
Bitter irony: Government told first-time buyers 5 months before bust began to “get into the Sydney housing market”; once in, “you’re pretty well set for life.”

“Nothing goes to heck in a straight line” because there is always a bounce, sooner or later – that’s my story and I’m sticking to it, but it does get tested from time to time, including in Australia’s housing bust.

Across the metro area of Sydney, prices of all types of homes combined, according to CoreLogic’s Home Value Index, fell 1.0% in February from January, 10.4% from a year ago, and nearly 13% from its peak in July 2017. Just over the past four months, the index has dropped 5.5%:


The volume of closed sales recorded in Sydney in February plunged 20.6% from the already weak sales in February last year, according to CoreLogic’s report.


In the Melbourne metro, the second largest market in Australia, prices of all types of homes fell 1% for the month and 9.1% year-over-year, according to the CoreLogic Home Value Index.

The index is now down nearly 10% from the peak in November 2017. Over just the past four months, the index for Melbourne dropped 5.0%:




Ed 3 mths ago


Ed 3 mths ago
Housing Bubble in Sydney Soars to New High, Politicians Promote Scheme to Bitter End

“Buy property in Sydney and you’re ‘pretty well set for life’”: Government to first-time buyers.

How far can a desperate government go to keep the whole overleveraged edifice of a housing bubble from tumbling down and doing God-knows-what to the economy and the banks? Australia is trying to find out.

The housing bubble in Sydney and Melbourne, by now among the top in the world, is taking on grotesque proportions, not only in price increases, but also in political pronouncements. So much of the economy depends on this bubble that no politician can imagine bringing it down to earth.


Ed 3 mths ago
HIS week’s global share market bloodbath was “a small tremor before the big earthquake” as Australia moves “ever closer to economic armageddon”, a former government economist has warned.

John Adams, a former Coalition policy adviser who last year identified seven signs that the global economy was heading for a crash — later warning the window for action had closed — believes the $4 trillion wipe-out was just the opening act of his apocalyptic prophecy playing out.

“When the economic earthquake hits, don’t be surprised to see soaring interest rates, massive falls in asset prices [like] shares, real estate and bonds, higher unemployment and widespread bankruptcies,” he said.

“Against a whole range of economic and financial metrics, the Australian and international bubble which I warned about in 2017 has continued to grow larger over the past 12 months,” he said.

“Australian household debt has never been higher — now at nearly 200 per cent as a proportion of disposable income — household savings have slumped, the US share market is now in a bigger bubble than 1929, risky derivatives are now being sold in significant quantities and global debt is $US80 trillion more than it was in 2008.”


Ed 3 mths ago
Australia is... Different


Ed 3 mths ago
Australia has just recorded its second straight quarter where the economy shrank on a per capita basis.

Removing the impact of population growth from fourth quarter GDP figures, the economy declined by 0.2 per cent in the three months to the end of the year, following a 0.1 per cent decline in the three months to September.

Including population growth does not make the picture much rosier, with the economy growing at just 0.2 per cent over the fourth quarter.

It also shows a dramatic slowdown over the course of last year, with annualised growth over the second half of the year coming in at 1 per cent, compared with the brisk 4 per cent in the opening months.


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