The Australian banking system could be at risk due to its high concentration of residential mortgages. Moody's Analytics manager director Tony Hughes explained that the sector is vulnerable to possible house price correction, the Global Property Guide reported. Australian property has long been highlighted as some of the most highly valued in the world and if prices remain too high, banks could be facing a major concentration risk.
While many local analysts don't foresee a market collapse, thanks to pleasing economic conditions in the country, Mr Hughes claims the US subprime mortgage crisis is proof that Australia isn't bullet proof. With banks in the US crippled by the housing collapse, it is important for the sector to ensure properties aren't excessively overvalued. According to Mr Hughes, only economists in a ten-year coma could be fool enough to believe an Australian housing collapse is impossible.
It is undeniable that property prices in Australia are rising dramatically. A new report from RP Data identified a number of areas where house prices are predicted to double over the next decade, based upon latest industry trends. Should house values increase at the predicted rate, property investors will have an opportunity to experience significant returns in Australia if they invest now. The RP Data Investors Report shows that Melbourne has the greatest number of suburbs with a likelihood of delivering a 100 per cent return within ten years, reports Yahoo.
A number of Sydney suburbs are also set for price rises, including Eastern Creek, Campbelltown and Belmore. Interestingly, more than half (55.7 per cent) of the areas with fast-rising property prices are located away from the main cities, including mining towns such as Hunter Pilbara, Mackay and Fitzroy.
However, soaring prices spell bad news for future would-be-buyers, who could become locked out of the market. A recent report by Auspol showed many Australians are becoming frustrated at the lack of affordable housing, with 84 per cent ranking house prices as more important than any other issue.
Article by +https://plus.google.com/109065039197462640663?rel=author on behalf of Propertyshowrooms.com
While many local analysts don't foresee a market collapse, thanks to pleasing economic conditions in the country, Mr Hughes claims the US subprime mortgage crisis is proof that Australia isn't bullet proof. With banks in the US crippled by the housing collapse, it is important for the sector to ensure properties aren't excessively overvalued. According to Mr Hughes, only economists in a ten-year coma could be fool enough to believe an Australian housing collapse is impossible.
It is undeniable that property prices in Australia are rising dramatically. A new report from RP Data identified a number of areas where house prices are predicted to double over the next decade, based upon latest industry trends. Should house values increase at the predicted rate, property investors will have an opportunity to experience significant returns in Australia if they invest now. The RP Data Investors Report shows that Melbourne has the greatest number of suburbs with a likelihood of delivering a 100 per cent return within ten years, reports Yahoo.
A number of Sydney suburbs are also set for price rises, including Eastern Creek, Campbelltown and Belmore. Interestingly, more than half (55.7 per cent) of the areas with fast-rising property prices are located away from the main cities, including mining towns such as Hunter Pilbara, Mackay and Fitzroy.
However, soaring prices spell bad news for future would-be-buyers, who could become locked out of the market. A recent report by Auspol showed many Australians are becoming frustrated at the lack of affordable housing, with 84 per cent ranking house prices as more important than any other issue.
Article by +https://plus.google.com/109065039197462640663?rel=author on behalf of Propertyshowrooms.com