http://au.finance.yahoo.com/news/Tsunami-hit-Aussie-real-aap-3554936888.html;_yl...Australia's love affair with property is about to turn sour as an "economic tsunami" looks set to hit world markets, American economic forecaster Harry Dent says.
Mr Dent, who arrived in Australia on Sunday, predicts the world will experience a second, deeper downturn, which will arrive between the beginning and the middle of next year.
Starting in Europe, the downturn will spread to the US, China and eventually Australia, he said.
"Australia is probably the best place in the world to survive this, but we do think Australia will not escape as well as it did from the last crisis (in 2008)," Mr Dent told AAP.
At the centre of the coming debt crisis is real estate, the forecaster says.
"People in places like Sydney or Tokyo or Miami say, `Hey, real estate can never go down here, we're a great place, everyone wants to move here, there's not much land for development', and what I say is that is exactly the kind of place that bubbles," Mr Dent said.
"Outside Hong Kong and Shanghai, Australia is the most expensive real estate market in the world compared to income."
Mr Dent said Australia's house prices would return to late 1990s or early 2000 levels.
Driving all these changes is simple demographics, specifically the peak of the baby boomers' spending, Mr Dent said.
"We predicted this (current) downturn in the US 20 years ago," he said.
"We said that in 2007 the peak number of baby boomers will reach their peak spending. They would have bought all their homes and then they will start saving for retirement ... and that you are going to see this downturn."
The drop-off in spending will affect everyone, even mighty China, Mr Dent said.
To survive the incoming "economic tsunami", Mr Dent said investors should sell their excess real estate and buy up assets in US dollars.
"Gold and silver are going to crash, they're a bubble," he said.
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Tsunami to hit Aussie real estate ??? (Read 2836 times)
