Australia’s house price slide poses threat to economy - Morgan Stanley

The Financial Times is out with a piece by the analysts at Morgan Stanley on the falling Australian house prices.

Key Highlights:

“The worst housing downturn in Australia for 35 years.”

"We think the steep downturn in house prices exposes Australia to the risk of recession, particularly in the context of an exogenous shock such as slowdown in Chinese growth.”

"Our models show that Australian households are most exposed of any G10 country to a housing slump and face a period of deleveraging, leaving growth heavily reliant on public spending on health, education and infrastructure."

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