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In the US this varies by state (in Vermont you can't walk away from a house so there wasn't too much of a bubble).

Are mortgages dissolved in Australian bankruptcies? You can't get blood from a stone. A jobless person can't pay their mortgage. As I said, there will be multiple claims on the money people have. I think it will play out the way it has done for the past 500 years.

No...you bankrupted until you clear your debts... fullstop....

No fresh start after bankruptcy? Why declare it?

Not sure if you are refering to slavery - but it is unlikly we will ever see that in our life times....at least I hope!

You get a fresh start.... after you've discharged your bankruptcy...

Most people declare bankruptcy... to stop further fees, interest, actions etc...

What evidence do you have that covers this for 500 years?

Well maybe not 500 years Novaris... but at least 350 years...

Don't you remember the great property collapse of 1666... when house prices in London fell lower than the price of firewood... so they burnt them...

And subsequent collapses where the price of canvas rose so markedly that only shipwrights could afford canvas....'

And the paupers jumped boats to Australia, New Zealand and America... because they couldn't afford tents...

Don't you read your history Novaris...

That's actually a new one for me Rupert, but all bubbles end the same way. Did you know they had futures contracts during the Tulip Mania (1637)? That just cracks me up.

Novaris, check out Tuplip Mania, The South Sea Bubble, The Mississippi Company, et al.

The Australian RE market doesn't seem quite as extreme as any of those but it does appear to be overvalued by 50%. When prices correct they tend to overcompensate in the other direction.

Not slavery, though some make an argument about people being debt slaves for life due to the change in the 2005 bankruptcy law & that student debt can't be resolved in bankruptcy.

If debts aren't discharged in bankruptcy in Australia things could get ugly in 2 or 3 years. Keep your eyes peeled for hobos!

It seems a bit OT talking about property prices...
but A measure of the value of property can't be drawn from another countries 'yard stick'.
Why are they over priced by 50%? Who said?
I figure they should be about the most expensive in the world, as the way I see it...
.. it is the best place in the world

.. and the gov might be on the right track not wanting to sell the whole farm... just a few hills

It's not based on another countries "yard stick" it's based on this:

Sustainable house prices = 3x average annual income of a given area.
From what I gather, prices in Australia are 6x average annual income so the prices will fall by 50%. It's simply a matter of time.
If you get a mortgage for more than your income will support you will default.

This is basic math.

It's a bit OT but this thread has something to do with finance & sustainability.

Maths sure... but the price of property in Australia is also driven by simple econonics... supply and demand...
According to research data from many different sources, housing demand due to the increasing population is more than the housing market could supply... when there is more demand than supply, price increases...

So to say that prices will fall according to your formula above, would be to state that the demand will fall.. in other words, population will decline... which many sources seems to indicate a population growth in Australia over the next 20 years...

Demand isn't the primary determining factor - affordability is.

Again, If you get a mortgage for more than your income will support you will default. End of story. You may demand shelter but you can only purchase what you can afford (in the long run).

Population can increase but if all the houses are too expensive they will either rent or buy what they ultimately can't afford.

I have no idea what the 30's were like in Australia but in America there was plenty of housing/food/goods (SUPPLY) and desperate need (DEMAND) yet people went hungry and were homeless.

Why?

Affordability.

The population didn't decrease yet prices crashed - till they became affordable.

^^^^
the 30's was after the depression I guess they were hard times

^^^
Yep if you can't afford it then rent..
Which has been happening for decades
and those that do manage to own or are purchasing also own a rental
People don't come to Aussie unless they pass the means test.
and those here have many opportunities if they choose to see it that way.
:ducksforcover:

^^
and
So then you are saying houses will fall to 150K (give or take a few 1000[aver' wage $51K)
I don't think so...
I understand the 28% of income etc.
But some people take 40 years to pay for a property.

cjinVT I see where you are coming from but I don't hold your contempt for the housing industry.