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It's my theory that homeowners can (and are willing to) pay more for the "house" because the discretionary (after the basics) part of the wage has grown and the cost of fitting out the house (the manufactured items we all "need") has dropped, possibly by 90%, so that wage earners no longer need...

I can't see anything there which convinces me that property is a "buy". You merely articulated the problems involved with the illiquidity of property as an investment.

You're not a Wall St banker in drag are you? There is the odd trillion dollars of derivatives looking for a home right now because someone picked up a few percent on "unlosable" bets. Let's just put it this way: I wouldn't buy shares in your bank.

You may be disappointed by this, but if I were leveraged into property I would draw no comfort from this at all. No sane person would leverage into an investment, merely confident that it would fall by no more than 40%.

Nothing wrong with a bit of caution. A spruiker once described it as being like trout fishing. You don't chase the one you saw swim past. You wait for the next. There will always be a next.