Australian housing a survivor on the world stage
Anne Davies
AUSTRALIA may be heading into recession but its housing market will fare much better than other countries, the International Monetary Fund says.
Unlike property markets in the US and Europe, which have experienced 40 per cent drops in prices as the housing bubble is pricked, Australia is not suffering from the same magnitude of inflated house prices, or the same sort of collapse once the bubble burst, says the IMF's Asia and Pacific Department's division chief, Ray Brooks.
In a weekend interview with the Herald in Washington, he said the IMF was now forecasting -0.2 per cent grown for Australia in 2009, down from its November prediction that the nation would ride out the global downturn with 2.2 per cent growth in 2009.
But Mr Brooks said: "I don't think the housing market is nearly as big a concern as in other countries. We did some analysis on the housing market. We tried to look at the fundamental drivers of the house price, and one of them is strong immigration flows, and the other is the interest rate."
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