Australia's "Tulip Mania" About to Crash; 44% Jump in Property Listings Proves the Proposed Housing Shortage is Gargantuan Myth; Playable Actions

by Mike 'Mish' Shedlock

For years I have been hear­ing about a hous­ing “short­age” in Aus­tralia. That myth has been shat­tered by lat­est stats that show a 44% jump in prop­erty list­ings.

The prop­erty mar­ket could be set for early-year price falls due to a build up of unsold prop­er­ties, with new fig­ures by prop­erty research com­pany SQM Research show­ing the num­ber of list­ings swelled 44% over 2010.

Man­ag­ing direc­tor Louis Christo­pher says over­all the huge num­ber of list­ings means prices are now hang­ing by a thread and a mar­ket down­turn is imminent.

“It’s still very clear to us that they are now at lev­els that would sug­gest a down­turn in the hous­ing mar­ket, although the stock lev­els have fallen sea­son­ally. The over­all num­ber is up now by 44% across the nation.”

“I wouldn’t like to see another inter­est rate rise any­time soon – it will accel­er­ate the downturn.”

The new fig­ures sug­gest that the short­age has been overblown. Res­i­den­tial prop­erty list­ings were 328,270 dur­ing Decem­ber, rep­re­sent­ing an increase of 44.9% over the year.

“In Surfer’s Par­adise, for instance, I know there are now over 2,000 prop­er­ties on the mar­ket in one post­code – just one. That area is really strug­gling at the moment, and it is now the equiv­a­lent of Florida in the United States.”

Christo­pher also says he is con­cerned about Dar­win, which recorded the largest increase out of all cap­i­tal cities at 57.3%. List­ings increased in Bris­bane by 59.4% and Perth by 54.8%. Mel­bourne fol­lowed closely with a 42.7% rise, although Can­berra recorded a rise of 46.5% as well.

The region with the high­est growth in stock lev­els was North Queens­land, with an increase of 216.3%. The region with the high­est month-on-month stock growth was Launce­s­ton, with 18.1%.