We’ve mentioned in the past that US homes are not in a bubble, but are extended as an asset class. We can see a healthy pull back of 25% to 33%.
The Australians are ahead of us in the cycle — their economy is very much based on Natural Resources — and they have seen some major price decreases.
So notes Australia’s Sun-Herald:
Bargains Galore? Sydney’s Best Bargains
table courtesy of The Sun-Herald
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UPDATE: March 30, 2005 5:41am
India is still on the expanding side of the Real Estate boom
Real estate boom in India (Bangalore)
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Source:
Bargains galore as house prices plunge (Australia)
Hannah Edwards
The Sun-Herald, March 27, 2005
http://www.smh.com.au/news/National/Bargains-galore-as-house-prices-plunge/2005/03/26/1111692684868.html
Our pullback will be similar in degree, but not as swift.
Barry: the Q4 data showed the median Sydney house price approximately flat over the quarter and over the year. This is a better guide than the change in asking price on a handful of properties.
also rememnber that a) most Aussie mortgages are floating rate and 3 month rates are up from a low of 4.6% to currently 5.9% b) the market was hit when the NSW government introduced new tax rules – effectively buyers and sellers pay stamp duty on second homes and that homes over Au$3m (approx $2m) pay 7%. Given that the Australian property market had been running on buy to let, second homes and the top end of Sydney, it’s hardly surprising the market is down. Given the US is predominantly fixed rate (for all the scare stories 90% fixed) and that as far as I know there are no plans for new taxes, the notion of a cyclical comparison with the US is flawed. (Not to say that some speculative excess won’t blow off however)