"Treasury estimates that even now two-thirds of Australians' wealth is invested in houses — and in the past six years, that wealth has doubled as house prices soared.
But house prices are a zero sum game. When prices rise, those who own houses grow richer, while those who don't grow poorer.
The crisis in housing affordability, over the long term, owes more to house prices outpacing income growth than to rising interest rates.
And what sent house prices soaring was the invasion of the investors, driven by the tax breaks for negative gearing and capital gains. Landlords used to own 20% to 30% of the housing market. But by 2003 they were taking almost 50% of housing loans (excluding refinancing), and even now, they take close to 40%, outbidding the first-home buyers."
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