Debt position. Negative gearing was not always the case, what that done was kill of builders building spec houses.
Debt is growing every minute of the day 60 billion since Abbott took over. 150 million / day is what they whinged about, but they do nothing.

I can grasp what the last three posts are all about but & this is the but I'm on about. This unaffordability for the 300K house would not be the case if negative gearing were to be done away with. That 300 K house would not cost 300K in the first place & that's the point. If we want to discuss the merits of no negative gearing then we must do so by disregatding the present values. Without negative gearing there would be a totally different pricing structure, in fact everything would be vastly different for the better, especially if the idiotic tax system were to be changed also.
Unfortunately, it would also mean hat those who made it under the present system would be forced to either work harder or get smarter. Overall though we'd end up with a better situation. Imagine the many Lawyers having to drive a Mercedes instead of Lamborghinis. Well, they can't buy an australian car now can they thanks to our negative gearing & tax Laws.

In the end affordability and those unable to get in to the market are likely to play only a minor role in any price fall.
We cannot be sure cost cutting across the board will let negative gearing remain as it is.
It fuels investment and price growth.
We need to think about price fluctuations in so many other things and ask will it bring housing down.
If unemployment rises the defaults that may take place could start the ball rolling.
Wheat wool sugar have in their history seen great rises and great falls in price.
As for safe areas? well in country towns we never truly got on the price train and may not suffer.
Home owners of the house they live in and intend to stay in will not be afected no matter what the price fall.
Hasbeen 50 grand is not a high income, some blue collar workers in highly skilled and demand areas get more than double that, then become middle income.
If the question asked here was can housing prices continue to rise forever I think most would say no.
If it was will housing prices ever fall my bet would be certainly, only when is unknown.

Belly, "If the question asked here was can housing prices continue to rise forever I think most would say no. If it was will housing prices ever fall my bet would be certainly, only when is unknown"

You do enjoy speculative gossip.

What do you say about wages falling and Centrelink payments falling as well? Because it is wage rises and government taxes that result in higher prices of materials and land.

That and the 'Big Australia' immigration of the Rudds of the world. Australian taxpayers have to stump up for new infrastructure and Centrelink payments for a new migrant population of around 200,000 a year which would be the same as building several large coastal cities every year.

Yet you foolishly believe that it is 'investors' and 'negative gearing' that are responsible for price rises, and that those mums and dads who 'invest' and supply the welfare housing your own Labor/Greens government refused to provide are wealthy capitalists.

You wish for a price collapse to hurt those aspirational mums and dads, but you don't imagine for a minute what effect that would have on business and workers. Or would you want government to artificially prop up such failing businesses so that union officials still have a job?

Honestly, get a grip.

Dear Belly,

Here's another link you may enjoy:

http://www.abc.net.au/news/2014/02-11/investors-at-decade-high-drive-growth-in-home-lending/5252294

Thanks Foxy, a telling link, remember my view on ignoring some.
While I have felt for some time a crash is coming, it is information such as that in the links here that gave me those thoughts.
We should confront the levels of debt worldwide and ask can that be kept under control.
To see the GFC is far from the only time massive investment firms went bust taking investment capital with them.
I fear some are not looking at the fact the world has a history of boom and bust.
A good tip most never ignore in investing is look for good advice from professionals who can be trusted.
But too be warned they too have rotten apples .
Impacting on a possible bubble burst are many different things.
But if unemployment5 leads to some defaulting, and higher interest rates to more we could see the first rock fall.
Much more likely and hard to avoid, is if China badly stalls in its growth another event that surely will come.