Finder makes money from featured partners, but editorial opinions are our own.

US think tank claims Australian property headed for collapse


house jengaA US-based think tank has argued that Australia is mere weeks away from a housing collapse.

According to a report by, US-based defence think tank International Strategic Studies Association has warned that Australian banks are precipitating a market collapse by winding back lending to foreign investors. A report from the group has predicted that “anticipatory caution on the part of Australian banks may accelerate a decline in the Australian economy”.

The group’s president Gregory Copley told a housing collapse could be imminent.

“We estimate that Australia has about six weeks or so to turn this situation around, otherwise there would be a massive hit on property valuations and the building trades. The urgency is, I believe, based on the fact that this is about how long it will take for the banks’ policies to start switching off a lot of existing and planned contracts for Australian properties,” Copley said.

Copley said Australian banks “clearly believe Australian real estate values will decline”, but wanted to avoid the risk by pulling back their own exposure to the property market.

“In so doing, they precipitate the market collapse but are less exposed to it,” he told

NAB chief economist Alan Oster told that ISSA’s prediction was “garbage”.

“To get any sort of problem you’ve really got to have something going wrong in China and then everybody selling their apartments at the same time. If they do that then it’s not an Australian problem, that’s a global problem,” Oster said.

The ISSA report follows a report from CLSA that claimed a wave of failed settlements on apartments could see some developers collapse and lead to a housing market downturn.

Latest home loans headlines

Image: Shutterstock

Find the right home loan now

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site