I'm saying what's happened in the US and Australia is different.
US prices were driven by rampant speculation fueled by shady lending practices where the lenders weren't accountable for defaults and a product that was doomed to failure from the start.
While there has been speculation in Australia, it seems driven largely by structural changes in the economy. Resources has brought a lot of money in. Those people traded up for property closer to the ocean and/or the city, driving up those prices leaving new entrants to live further and further out.
This is basically a natural phenomenon that happened in a somewhat accelerated fashion. I see a plateauing of prices for some years to come as a result.
Rents are simply playing catch up with the change in house prices. They always lag. There's nothing surprising here.
It is however concerning because Australia is very much dividing between the haves (construction/resources) and the have nots (everyone else).
I largely missed this bubble as I was working in Europe at the time (2001-2004). As it turns out, financially speaking I would've been better off buying a house for $80k (in 2000, worth $350k+ in 2004-2005) and sitting on a beach in Spain for 4 years than working.
Australia just isn't that attractive a place to live (for me) now and that's kinda sad.
US prices were driven by rampant speculation fueled by shady lending practices where the lenders weren't accountable for defaults and a product that was doomed to failure from the start.
While there has been speculation in Australia, it seems driven largely by structural changes in the economy. Resources has brought a lot of money in. Those people traded up for property closer to the ocean and/or the city, driving up those prices leaving new entrants to live further and further out.
This is basically a natural phenomenon that happened in a somewhat accelerated fashion. I see a plateauing of prices for some years to come as a result.
Rents are simply playing catch up with the change in house prices. They always lag. There's nothing surprising here.
It is however concerning because Australia is very much dividing between the haves (construction/resources) and the have nots (everyone else).
I largely missed this bubble as I was working in Europe at the time (2001-2004). As it turns out, financially speaking I would've been better off buying a house for $80k (in 2000, worth $350k+ in 2004-2005) and sitting on a beach in Spain for 4 years than working.
Australia just isn't that attractive a place to live (for me) now and that's kinda sad.