Is The "Property Bubble" About To Burst?
Some are predicting it is only a matter of time and that time is growing near when we will be rattled by an unprecedented property melt down.
A scary thought for many I should imagine. But where do these scare mongers gather such evidence.
First, I should point to the fact that these people tend to generalise by throwing everything into the same mix; a two million dollar house [in] with a first home in Invercargill for example. Not being derogatory to Invercargill, but you get my point.
My argument is this, for properties in the lower price bracket to fall below current values, the cost to build, land, or a combination of both, would need to fall by around 50%.
Sure, in some regions where communities are facing hardship due to industry layoffs and closure there will be the exception and there always will be, as supply and demand is an ever changing factor in any commodity.
However I think anyone would be hard pressed to identify any region expected to take a hit of that magnitude........
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