Negative Views

"For the first time this year, most investors surveyed are expecting house prices to remain flat or fall.

SENTIMENT among Australian property investors is turning increasingly bearish, according to the latest Investor Pulse poll of investors conducted by Colmar Brunton and BusinessDay.

For the first time this year, the number of investors expecting house prices to remain flat or fall outweighs those who see prices rising. The fundamental reason for the shift in sentiment is a dawning belief that Australian housing is in a ''bubble'' that at some point will burst and return to historic levels of affordability.

When asked about recent comments by famed US fund manager and property bubble expert Jeremy Grantham - who described Australian and British property as the only two of 34 bubbles he had studied that had not yet burst - 43 per cent of investors agreed that reversion to the mean would involve considerable pain. Only 25 per cent of investors disagreed with the bubble diagnosis and 32 per cent were undecided."

For Full Story and Chart, see Domain