*Pooja*
Member
can sum1 explain whats happened in the property market? teacher didnt explain it enough in class...
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the property boom > (1 Viewer)
- Thread starter *Pooja*
- Start date
i-color
Member
- Joined
- Jan 2, 2004
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- 210
property market had boomed rapidly since last year due ot increased demand (mainly from the first home buyer's scheme by howard govt a few years back).
Since then. housing prices have increased rapidly and supply of apartments have clearly outstripped demand causing oversupply and excess. RBA has been increasing interest rates to help ease this housing bubble as a burst would be detrimental to the economy (due to collapse of wealth effect)
More recently, housing bubble have finally shown signs of easing, as housing prices have recorded a mild slowdown, first in the last few quarters. This slowing down in housing prices may affect the economy through the wealth effect, slowing down economic activity and consumer sentiment etc.
Since then. housing prices have increased rapidly and supply of apartments have clearly outstripped demand causing oversupply and excess. RBA has been increasing interest rates to help ease this housing bubble as a burst would be detrimental to the economy (due to collapse of wealth effect)
More recently, housing bubble have finally shown signs of easing, as housing prices have recorded a mild slowdown, first in the last few quarters. This slowing down in housing prices may affect the economy through the wealth effect, slowing down economic activity and consumer sentiment etc.
thats prolly wat her teacher said- o wat whered u come from? lol- i meant hoplite
hmm interesting what u said.... wat do u mean by the wealth effect in relation to housing? y would it slow down AD? oh i get it lol, cuz their house prices go down in vlaue? so they feel poorer so they spend less? is that the rundown?
hmm interesting what u said.... wat do u mean by the wealth effect in relation to housing? y would it slow down AD? oh i get it lol, cuz their house prices go down in vlaue? so they feel poorer so they spend less? is that the rundown?
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