Tuesday, November 19, 2013

What is now normal?

"But what if the world we’ve been living in for the past five years is the new normal? What if depression-like conditions are on track to persist, not for another year or two, but for decades?"

What if low interest rates continue for a number of years.  What if there is little employment growth or wage growth for a number of years?  Rents will not increase. Capital growth will be less than past averages.

Those negatively gear and making losses will continue to make losses. And so housing prices will gradually decrease.  Is this possible?

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