Here’s an in-depth look at the Australian Property Market and how the current prices affect the economy. Arek Drozda from the Property Observer breaks down the issue, and whether we really are facing a property bubble.
He points out an interesting correlation between Home values, median cost of buying and personal incomes. Home values have increased drastically, and economists fear that this can reach unstable levels. Despite this, commodity costs have barely increased as opposed to personal incomes, therefore the cost of buying is more affordable than 27 years ago. This shift only means that we have enough to go around, and that prices are moving.
The income capacity of Australians, according to the article will be the key. Home affordability is never an issue for as long as we are earning more than we spend.
Read more about this on the Property Observer website.