Families Want Houses With Backyards Over High-Rises

One of the characteristics of Australia’s housing bubble is that it is not really a housing bubble. It is a land bubble.

Australia’s banks, whose business is heavily skewed towards providing home mortgages, have catalysed an extreme rise in land values, in large part because they rate it as low risk. It has been an exercise in circularity. First boost the price of land, then claim that the high land prices provide sound collateral for the loan. Rinse and repeat.

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