Bloomberg Australia has published a compelling overview of the housing market in Australia. They underscore the relatively myopic stance of the regulators. DFA was cited in the article.
Australia has the third-most overvalued housing market on a price-to-income basis, after Belgium and Canada, according to the International Monetary Fund. The average home price in the nation’s eight major cities rose 16 percent as of June 30 from a May 2012 trough, the RP Data-Rismark Home Value Index showed.
In Sydney, the most populous city, where price growth has been strongest, values soared 15 percent over the past 12 months. That compares with a 5.4 percent increase in New York City in April from a year earlier and a 26 percent jump in London prices in June quarter from a year ago.
“There’s definitely room for caps on lending,” said Martin North, Sydney-based principal at researcher Digital Finance Analytics. “Global house price indices are all showing Australia is close to the top, and the RBA has been too myopic in adjusting to what’s been going on in the housing market.”
Worth recalling the chart we published recently on Loan to Income By Post Code.
