Australia's House of Cards is Collapsing: Recession Coming Up

Australia's housing collapse is now in full swing. A recession will follow shortly.

Inga Ting, Geoff Thompson and Alex McDonald provide and excellent set of graphics and information on the bursting of Australia's housing bubble at House of Cards.

Home prices in more than four out of five council areas have reached their peak and are sliding towards an unknown nadir, according to the latest figures from property market analyst CoreLogic.

As the slump moves into its second year with little or no prospect of rebound, the downturn in capital city property markets threatens to drag down the rest of the economy.

And with a mixed outlook for the global economy, doubts are surfacing about where Australia is going to find the fuel to extend its near-record run of 27 years of unbroken economic growth.

Yearly Change in Median Dwelling Value

The graph in the article is interactive with a choice of eight cities. Sydey displayed above.

Major Declines Since 1980

Click on the graph for an even larger image.

Perth and Darwin have been clobbered. Sydney is in the works.

Every Bubble is Different

I also like this Tweet in response.

I believe this person means 2019 not 2018

Party is Over

There is no way Australia avoids a recession. I don't care what the central bank does.

Mike "Mish" Shedlock

Comments (10)
No. 1-4
Casual_Observer
Casual_Observer

I think the same goes for the US. Reports of layoffs at architecture and real estate firms are telling. This recovery was always a farce and everyone knew it was based on more debt and not wage gains. 60% of CFOs are planning for a recession in 2019 so the layoffs will come after the holidays. Once the slide begins it will be a cliff dive.

Expect social moods to change sooner than later. This time down I believe we will see the rise of socialism in the United States with widespread public union strikes and the like. It is possible a socialist gets elected in 2020 and makes more promises that cannot be kept as the economy continues its decline.

SMF
SMF

Central banks already shot their wad over the last 10 years propping this house of cards up. Very little can be done this time around.

ronbruce
ronbruce

Sydney & Melbourne home prices rose 40% over 3 years, home prices in those same cities have fallen 10% this year... The sky is not falling.

Six000mileyear
Six000mileyear

Contracting rate of debt growth is DEFLATIONARY. A combination of lender and borrower believe the debt can't be repaid, so no fewer loans are made.