60% PROPERTY FALL?! IS HARRY DENT FINALLY GOING TO PIN THE TIMING OF AN AUSTRALIAN PROPERTY CRASH?

(To go straight to the interview and skip the report - click here)

Goodness knows, if you’ve lived in Australia for any length of time and followed the economic news, you’ll have heard of Harry Dent.

This week, I sat down with him for an extensive interview.

Harry is an entertaining character—and it was difficult, (even for me), to get a word in edgeways! So, in this week's report, I delve into what we discussed, where I agree with him and, importantly, where I don’t!

MORE WRONG THAN RIGHT?

These days, Harry is probably better known for the forecasts he has got wrong than those he has got right.

To be fair to Dent, he hasn’t always been wrong. He made his name with The Great Boom Ahead, published in 1993.

At the time, many commentators were pessimistic about America, but Dent argued that the baby boomers were moving into their peak spending years and would drive a powerful economic expansion.

Broadly speaking, he got that right!

After a fairly flat 1994, the US economy and stock market surged through the remainder of the decade.

He was also early in recognising the demographic problem facing Japan following the collapse of its late-1980s property and stock-market bubble—which, (not so coincidentally), occurred at the end of the 18.6-year land cycle!

But this wasn’t simply a case of Japan getting older.

Japan’s birth rate fell sharply and remained below replacement level, while at the same time, immigration stayed very low. From around 2008, the total population started falling.

That meant fewer young adults and therefore, fewer first-home buyers, lower housing turnover due to it, and less of the economic activity that naturally comes with people buying homes and raising families.

In other words, Japan’s land cycle lost its fuel – property buyers.

You’ll have heard me say many times in these reports that land booms require consistent population growth as a pre-requisite to anything else happening.

That population must then pour into major cities where the supply of well-located land is limited.