Quote Originally Posted by tricha View Post
How does that compare to now, when houses soared above inflation recently and u might say, house prices are to high?
If I was borrowing $US I could buy an Aussie house and do nicely.

But since I borrow in AUD, right now it obviously doesn't stack up. I'd need interest rates to lower or property to go up. But it is an opportunity to look out for over time if inflation rears its head. For example, this might happen to certain asset classes in the US, if their interest rates drop and inflation rises.

Re property now - I think that when Australian interest rates start to come down in 12 to 18 months perhaps, then there will be a spike in residential property values. Reason - now no one is building due to high interest rates and rental returns not justifying purchases. But there is so much pent up demand, that when rates lower again, people (both investors and home owners) will jump in as fast as they can in a market with undersupply, since rents are also getting higher and higher. Unless we end up in a recession. Which would just intensify the jump later.