Kerr Neilson's view on Aussie Property

Kerr Neilson's view on Aussie Property. What has been the driver of this strong residential property market? Kerr Neilson says principally it has been the willingness of Australians to progressively use much more debt, assisted by progressive falls in interest rates. To believe that home prices in the next 10 years will meaningfully outpace the consumer price index (CPI), as they have in the past, would require a remarkable set of circumstances. It would need some or all of the following: 1) Continuing low interest rates. 2) Willingness to live with more debt. 3) Household income being bolstered by greater participation in the workforce. 4) Average wages growing faster than the CPI. The last point is improbable seeing that wages and the CPI have a very stable relationship, while the other points are not very likely. (VIEW LINK)