Property crash is like popping popcorn, especially in Melbourne: Harry Dent

Property crash is like popping popcorn, especially in Melbourne: Harry Dent
Property crash is like popping popcorn, especially in Melbourne: Harry Dent

Apparently the property market is like popcorn popping - different markets bursting at different times.

Forecaster Harry Dent sees real estate in coastal cities all around the world as greatly overvalued.

"I see it like a popcorn popper, different markets are bursting at different times … but all of real estate in coastal cities all around the world is greatly overvalued and they're all going to burst whether it be 30% or 40% ... or 90% in the worst case," Mr Dent told News Ltd papers which labelled him as a widely respected columnist.

Stand by for Melbourne to be the hardest hit, a bubble that will burst and wipe out up to half the value of property.

Harry Dent actually reckons "Melbourne has been, actually, the biggest bubble in recent years and I would expect the biggest burst there."

"In Australia obviously the bigger bubbles are in Sydney, Melbourne, Brisbane and Perth because they had the greatest growth and the greatest limitations in supply - but not quite as much in Adelaide and other cities."

The bubble would burst after a crash in the stock market and would be linked to an anticipated crash in the Chinese property market, Mr Dent, who headlines a Secure the Future event in Sydney and Brisbane later this month, said.

The event also has Mark Bouris as a headline act. In late 2011 when Harry Dent made his last over the top Australian forecast, the Yellow Brick Road chairman Mark Bouris took on the US doomsayer's then bearish claims that Australian property was going to crash.

Mr Dent has now predicted the economic and real estate bubble in China will burst in the next couple of years, and Australia would be hit hard as a consequence.

"The China bubble is going to burst, starting around next year, and it is going to be the biggest bubble to burst. It is the greatest bubble, the most government driven, the most extreme in valuations," he said.

"Australia is the best country to weather this downturn and take advantage of the next boom.

"But this China bubble is going to back up on resource and commodity markets and it's going to hit Australia hard and I think it's going to cause your real estate to get hit and finally burst.

"I see real estate going down 60 to 65% in the US, it's probably more like 30 to 50% in Australia, but that's still enough for you to say: Hey why would you go buying real estate?"

"So why would you want to own real estate unless you're going to live in it forever or it's very important to your business."

Harry Dent's longheld views have been comprehensively challenged by most local commentators.

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

Comments

Be the first one to comment on this article
What would you like to say about this project?