Australia's housing bubble is back in full swing. Prices rose almost 11 percent over the past year to record levels in absolute terms and near-record levels as a share of household income. Prices in Sydney rose 15 percent.
Household debt as a percent of income surpassed the previous record.
WAtoday reports Australia's house prices 'flashing red', debt to income ratio at record levels.
Australian household debt has hit a record 177 per cent of annual disposable income while housing valuations are "flashing red", according to Barclay's chief economist, Kieran Davies.
"House prices now equate to 4.3 times annual income and 28 times annual rent, both within a fraction of their historic highs," Mr Davies said.
Home Prices to Income
Household Debt as Percent of Income
In March RBA governor Glenn Stevens warned "we need to be alert to the possibility that the past year of strong rises in dwelling prices leads people to assume that this is the norm".
"Were such an assumption to lead to increasing speculative activity, accompanied by a renewed increase in household leverage with all the associated risks to the housing market ... that would be unwelcome," Mr Stevens said.
That home prices and debt-to-income are back up at record levels is a sign that speculation is already back in full swing already.
Is there any central bank governor anywhere that can spot speculative bubbles before they burst? Apparently not.
Mike "Mish" Shedlock
In Other News: North Korea Threatens to Hack US if We Don't Acknowledge Their Innocence in Hack Attacks | Michael Schaus
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance: William's Edge Webinar for December 19th, 2014 | John Ransom
In Other News: New Captain America Will be Black; Racist Liberals Suddenly Become Fans | Michael Schaus
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for December 17th, 2014 | John Ransom