The approach to the property market depends on the view one takes of the economy. Those who were leaning D&G like a certain high profile academic, a few months ago have been proven wrong so far as govt fiscal and monetary policies, plus immigration and demand/supply all propped up the property market.
Below is summary by Ross Gittins of the govt's approach as presented by Dr David Gruen of Treasury
http://www.smh.com.au/business/learning-from-the-great-depression-20091113-iens.html
This time it's different from the great depression as Australia avoided 3 big mistakes:
- liquidity not constrained by the gold standard with the floating exchange rate and access to credit facilitated by Government
- no ''tragically tight'' monetary policy in the defence of the gold standard and with prompt interest rate cuts
- under conducive exchange rate policy and terms of trade, expansionary fiscal was effective in stimulating the economy, unlike pre Keynesian approaches.
So, under the above policies I think the property and share markets will tend to move up, especially in the era of Asian growth.
Below is summary by Ross Gittins of the govt's approach as presented by Dr David Gruen of Treasury
http://www.smh.com.au/business/learning-from-the-great-depression-20091113-iens.html
This time it's different from the great depression as Australia avoided 3 big mistakes:
- liquidity not constrained by the gold standard with the floating exchange rate and access to credit facilitated by Government
- no ''tragically tight'' monetary policy in the defence of the gold standard and with prompt interest rate cuts
- under conducive exchange rate policy and terms of trade, expansionary fiscal was effective in stimulating the economy, unlike pre Keynesian approaches.
So, under the above policies I think the property and share markets will tend to move up, especially in the era of Asian growth.