It turns out that Isaac Newton was a better physicist than he was an investor. Newton lost a fortune-around £20,000-in one of history’s most notorious market collapses, the South Sea bubble, when the South Sea company collapsed in 1720 (that’s the equivalent of about £7,500,000 in today’s money. Ouch!)
If only he applied his revolutionary theories on gravity, to investment markets.
Newtons Third Law of Motion - for every action, there is an equal but opposite reaction.
Australian real estate (or is that more just Sydney and Melbourne) now appear to be succumbing to Newton’s third law.
What goes up, must come down.
Sydney and Melbourne’s property price declines seem to be accelerating, which has sparked a flurry of warnings of impending doom. Some say falls of up to 40% are possible.
Others say Australia’s property bubble is just a media circus. A ploy to attract viewers and readers, rather than reality.
Or is it just an orderly correction, delivering what many people were demanding-lower property prices?
So, the question is, will the housing bubble slowly deflate or burst with a loud bang?
I’d be very interested in your thoughts and why you think that way (of course we know the main purpose of property predictions- to make meteorologists look respectable!!).
Property is after all Australia’s favourite investment and the ramifications of a serious decline in housing have consequences for us all .
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