"Australia has the third highest house price to income ratio in the world."
Here is a good overview of the situation.
It is likely that the banks will be hit hard if D-day comes to our doorstep. With even a small lift in interest rates, chaos will reign supreme as many investors are highly geared and simply do not have the income necessary to service their loans if interest rates head north.
The only reason we were spared during the GFC was due to the resources boom over here at the time. That boom is now over. One of the major sectors holding our economy up is the property and construction market.....and if that suffers it probably is going to end in tears.
Of course this may continue on for years....but sooner or later.....what comes up must come down....and the likely fall could be substantial.
) I don't know why this thread attracts many traders and recieves a lot of comments.
