For years, Australian residential property has been viewed as a one-way bet. Mention the possibility of falling house prices and you’re often met with disbelief. Population growth, constrained housing supply and a deeply ingrained belief that property always goes up have combined to create one of the most expensive housing markets in the developed world.

But markets are ultimately driven by fundamentals, and those fundamentals are becoming increasingly difficult to ignore.

A market built on debtA market built on debt

Australian property prices are some of the most expensive in the world, and households are among the most indebted in the world. Household debt is around 112% of GDP and 67% in the United States. For context, household debt in the US was circa 100% in 2007.





...read more at bondvigilantes.com