The Herald Sun has recently reported that the Australian property market is heading towards a "bloodbath". Leading US real estate analyst, Jordan Wirsz, thinks prices are likely to fall up to 60%, with our capital cities being hit the hardest.
And that's just the residential sector. Mr Wirsz believes land investments could decrease in value by as much as 80 or even 90%, while commercial property could lose out by as much as 50%.
Is the Australian housing industry a bubble about to burst? Via.
It's a pretty 'doom and gloom' outlook, and Mr Wirsz places the blame with "artificially low interest rates, high loan-to-value lending practices, overinflated property prices, unrealistic vendor expectations and Australia's large number of second mortgages".
He doesn't believe the property market will start to recover until 2016.
But is this just a US outsider trying to throw his weight around? Local experts disagree with his claims.
Paul Bloxham, Chief Economist with HSBC, says that a property value crash simply isn't on the cards. He believes that we'll be buffered from the current global instability thanks to more rate cuts, strong overseas demand for Australian assets, a low dwelling price to income ratio and an undersupply of housing.
Meanwhile Sydney real estate agent Charlie Bailey of Ray White is of the opinion that there's no 'housing market bubble' to burst.
What do you think? Is the Australian housing market in for a gloomy future? Or is this just the naysaying of people who don't understand our market?