Australia should start preparing for house-price induced downward spiral - OECD

Australia should start planning for a house-price induced downward spiral, the Paris-based Organization for Economic Cooperation and Economic Development (OECD) warned on Monday. 

Key points

• If house prices collapse consumer spending could suffer, via negative impact on wealth including from exposures to bank shares, which would encourage deleveraging.
• Together with reduced housing-related expenditures, this would put pressure on the whole economy.
• OECD believes the Australian property market will make a "soft landing.”