Australia is not in the midst of a housing bubble, according to BT Financial.
Speaking at a mortgage industry conference hosted by brokerage group Vow financial in Queensland last week, BT Financial chief economist Chris Caton said talk of a housing bubble is simply “untrue”.
“The property story in Australia post the GFC is three chapters long. We saw prices fall early last year (although nowhere near the 40 per cent some doomsayers were predicting) – the first chapter – and then recover sharply – the second chapter,” Mr Caton said.
“If these price rises had continued then a bubble was a possible outcome; but interest rate rises have taken the heat out of the market – the third chapter.”
Caton said analysts who compared the Australian property market with overseas markets to suggest it was over-priced failed to appreciate the differences in the local market.
“Our demographics, our mortgage structure, the supply situation, all combine to make our market different,” he said.