Aus housing crash flagged!!
#1
BE Enthusiast
Thread Starter
Joined: Jan 2003
Location: Brisbane
Posts: 378
Aus housing crash flagged!!
Anyone thinking of renting for a while once out there?
Mike.
Property crash flagged
15Apr03
AUSTRALIAN residential property prices are more exposed than ever to a crash in the event of an economic downturn, international ratings agency Fitch Ratings warned today.
Fitch noted that household debt had increased and the affordability of housing had fallen.
It also said that the availability of credit, from banks and other lenders, had fuelled recent property market price hikes.
House prices in some major Australian cities have risen by as much as 50 per cent over the past two years and may be reaching unsustainable levels.
Australian household debt is now at $540 billion, and the ratio of household debt to income had doubled to almost 110 per cent in 2003 from 54 per cent in 1993.
This placed Australian consumer indebtedness on a level with the United Kingdom and United States.
The report noted a similar increase in the multiple of average house prices to average earnings to almost 6.8 times in 2003 from approximately 4.5 times in 1993.
Fitch said the consequent debt-servicing strain on households left the property market highly exposed in the event of rising unemployment or interest rates.
Fitch also noted the recent construction boom was bringing more new properties onto the market, therefore fundamental weakness in this sector could have a negative impact on the property market.
"Australian residential property prices are more exposed than ever to a crash in the event of an economic downturn," Fitch said.
Link to article.
Mike.
Property crash flagged
15Apr03
AUSTRALIAN residential property prices are more exposed than ever to a crash in the event of an economic downturn, international ratings agency Fitch Ratings warned today.
Fitch noted that household debt had increased and the affordability of housing had fallen.
It also said that the availability of credit, from banks and other lenders, had fuelled recent property market price hikes.
House prices in some major Australian cities have risen by as much as 50 per cent over the past two years and may be reaching unsustainable levels.
Australian household debt is now at $540 billion, and the ratio of household debt to income had doubled to almost 110 per cent in 2003 from 54 per cent in 1993.
This placed Australian consumer indebtedness on a level with the United Kingdom and United States.
The report noted a similar increase in the multiple of average house prices to average earnings to almost 6.8 times in 2003 from approximately 4.5 times in 1993.
Fitch said the consequent debt-servicing strain on households left the property market highly exposed in the event of rising unemployment or interest rates.
Fitch also noted the recent construction boom was bringing more new properties onto the market, therefore fundamental weakness in this sector could have a negative impact on the property market.
"Australian residential property prices are more exposed than ever to a crash in the event of an economic downturn," Fitch said.
Link to article.