When You’ve Paid Your Rent, You’ve Paid Your Way

Thursday June 24th
7pm, 1/27 Hardware Lane
Dr Gavin Putland

The powerpoint and audio have been uploaded here

Australia’s residential land prices, commonly but incorrectly conflated with “house” prices, started falling in 2008. Having seen what falling “house” prices did to the financial systems of other countries, the Federal Government announced the First Home Owners’ Boost (FHOB), which pushed prices back up.

But now the momentum has run out.

Property sales in Melbourne plummeted on the last weekend of May. If the low turnover continues through June, it portends a price slump more severe than that of 2008.

What will the Feds do this time? Will they let prices fall, let property buyers and their lenders go bankrupt, let big depositors lose their money, and take the rare opportunity for the Government to create credit for infrastructure projects without causing inflation?

Fat chance.

Will they spring another “temporary” FHOB, rolling the stone still further up the hill, giving it still further to fall, and locking still more people out of the market in the mean time?

Or is there a third option? Can Sisyphus sit on his stone?

If not, can the price rise at least be slowed without causing a crash? Can some renters be assisted into home ownership without leaving the others worse off? If expenditures or tax cuts are needed, where will the money come from? And if there’s a solution, it is simple enough to be implemented at a moment’s notice by politicians who have been busy denying the problem?

Gavin R. Putland, Research Officer for Prosper Australia, throws the politicians a lifeline.

RSVP please (to assist with catering – nibbles and drinks)


  1. Gavin R. Putland10-06-2010

    UPDATE: “Property sales in Melbourne plummeted on the last weekend of May.” That statement relies on a report in Crikey on May 31, but I have not been able to confirm it. I now suspect that it was based on a comparison between figures from different sources, the later figures being from a more “pessimistic” source than the earlier ones. Be that as it may, auction clearance rates already indicate a crash in Brisbane and a slowdown in other cities. Watch this space…

  2. Anonymous10-06-2010

    Hi Gavin, Victorian weekly property sales as reported by the REIV (incl. Private sales & Auctions) peaked at just over $1.03B in mid March 2010. As of the first week of June, weekly sales is down to just over $730m, a fall of 29% since the peak.

  3. Ned21-06-2010

    Love the article photo’s.Every time i read a new housing report here I, feel like an impatient kid sucking on my foul tasting rental lollypop in the back seat of the car, blurting out “Are we their yet”,The driver is the manic RBA chief and its an old valiant regal with bald tires in bad weather. Cant we just turn around and go home, i think. Thats right, their is no home to turn around and go back too…n/t

  4. Karl Fitzgerald21-06-2010

    excellent Ned, love to see u again at this event.

    Gav’s political science trade-offs are a feat in diplomacy, all the while getting us closer to the aim of recouping the public’s rents.

    See u this thursday.

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