A debate is a chance to crunch opposing views. Strong ideas advance and poor ones are discarded. Good. But when participants and audience have already made up their minds, fresh argument goes nowhere.

The Money Institute’s big debate in Sydney on Tuesday asked – Will the Australian Property Market Crash? The audience were dragged over the terrain, beaten mercilessly with graphs and stats, but left the event little wiser.

The first speaker, Tony Hayek, is a successful property investor who made his pile in highly geared buy-to-let in Sydney. His long-time strategy worked for him! He flourished through the GFC, lifted by rising rents, higher house prices and falling interest rates. If looking in the rear-view mirror is the measure of a driver, this man has it won.

“The most predictable economic disaster in Australia’s history.” David Collyer Prosper Australia

I shared my personal circumstances, renting a large and comfortable house in leafy Balwyn for $24,000 a year. But the property is worth $1.6 million, so the owner gets a paltry 1.6 per cent GROSS return. House prices have disconnected from earnings, construction costs and rents. Landless young adults are excluded and loaded up with savings-sapping costs: superannuation (funding both their own retirement and the old age pensions of the baby boomers), that vile tax on education, HECS, and expected to sacrifice two incomes for life to buy a crummy starter home.

I had to put up this horror graph:

Would somebody please tell Senator Barnaby Joyce Australia’s debt problem is consumer debt, not government debt. His deliberate misleading of voters is getting on my nerves.

Amanda Lynch, CEO of the Real Estate Institute of Australia, read carefully from a prepared speech. Her slides were illegible to the audience, but not to me, sitting just below the screen. No, Amanda, you did not prove all is well. No, Amanda, the outcome you predict is not self evident, logical or coherent. Sorry.

“Rising mortgage debt caused the house price bubble; now that debt has peaked, the same force that drove house prices up will drag them down.” Professor Steve Keen

This man is considered a seer and a prophet overseas, but not here. His groundbreaking work on credit and the banking system fills a gaping void in economic theory. He had me and a number of others nodding in agreement throughout. Sadly his excellent debunking of neo-classical economics was lost on most. His presentation is here.

”Many of the tell tale signs of a bubble are not present and just because house prices are overvalued doesn’t guarantee a bust.” Dr Shane Oliver AMP Capital Markets

Dr Oliver oozes reasonableness. He foresees stable house prices for a decade as wages, rents and construction costs catch up. A terrific outcome for homeowners who simply have to make regular payments on their mortgages to achieve nirvana. The fact that stable prices will force 1.25 million negatively geared taxpayers to sell seems lost to him.

“A Ponzi scheme inflated by an unsustainable credit-fuelled boom. The bust has already begun and is unstoppable.” Kris Sayce Money Morning

Quite right. Sayce refers to Hyman Minksy’s definition of the excessive use of credit where the asset must be sold to realize the funds to repay interest and principal, A.K.A. negative gearing. Sayce has put his presentation up here.

“House price crash talk isn’t new and it continues to be more successful than any other topic in generating sensational headlines that scare the living daylights out of people. There are many challenges facing the Australian residential sector, including the need to aid entry level buyers and rental households. The focus should be on what needs to be done to alleviate upward pressure on dwelling prices.” Dr Harley Dale Housing Industry Association

We aren’t building enough houses, Dale says. We need government assistance (subsidy) we need less regulation, oh, and how about some tax breaks too.

In 1888, Marvellous Melbourne, then the second largest city in the British Empire, boomed then bust. Walking the streets of inner Melbourne you will struggle to find a house built between 1889 and 1910. Twenty years of nil construction activity will leave Dale without a job. Sorry.

Was the audience any the wiser? After the debate I was approached by quite a few landless young adults determined to stand aside and allow this unsound monstrosity we call the housing market to collapse under the weight of its own contradictions.

They will buy in when prices match incomes, with a big deposit and the earning capacity to pay down a mortgage quickly. They are the future, Australia.