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Housing now a key source of growth for most states

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Julia Corderoy | 24 Nov 2014, 08:20 AM Agree 0
Figures released by the Australian Bureau of Statistics show that residential construction became a key source of growth for most state economies
  • Jessica | 24 Nov 2014, 11:17 AM Agree 0
    ... This isn't a good thing...

    Houses aren't exportable, you cant trade them in for food if you need it, they don't offer new technology or development...

    Over the last 6 years since 2007-2008 if ever single other economy on the planet has told us anything its that when an economy is exposed to low rates and housing becomes a 'source of wealth' you know its scraping the bottom of the barrel and the aforementioned economy is on its last legs.

    Hats off to anyone who made their money and left before the cluster-fluff that is Australia hits.

    Just like every other country where low rates and no tools were in place to stop an asset bubble appearing, Australia is about to fall into the same trap.

    We had years of international experience and dozens of examples of how not to let housing get out of control but alas no one listened. All they heard was the jingle jingle of speculative capital growth. Typically the end result will be the government stepping in and 'bailing-out' housing by introducing a 50k first home owner grant which does nothing but cause prices to go up 50k or a 'investor double negative gearing tax break. Get back what you lose and then we'll match it again.' Or the bank deposit freeze and 10% haircut to pay for negative gearing tax returns.

    No wonder 50% of people under 30 dont have jobs and skilled migration of locals is out of the country. Why would anyone want to live here. 300m2 house 1 hour from a city for a dual income 30 year loans that have negative wage growth with rates that can only go up in jobs to service baby boomers who get to retire at 65 instead of 70. Or move overseas for a 15 year single income loan that grows with rates that are 15 year locked in at 3-4%!!! on a 1000m2 block 15 minutes from a city and retire at 58... All for the cost of a plane ticket.

    Pretty easy choice.

    Thats Australia!

  • Tom | 25 Nov 2014, 09:36 AM Agree 0
    Jessica, may I ask where you got your facts from? The facts don't support your comment of 50% unemployment in the under 30 age group.
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