Its been a couple of years since Sydney house prices fell in the face of rising home prices and increased mortgage rates and oversupply in the residential property investment sector especially in Sydney but also in Melbourne.
But the dramatic commodity price rises that were fuelled by China's increased demand for raw materials, were in turn many feel, fuelled by heavy US consumer spending.
Should this spending dry up or even moderate, then the turbulence seen in Commodity stocks my turn into a significant fall in demand and prices. This in turn could have a marked effect in house prices in the Major cities. Its worth noting that because of recent investments in infrastructure in many mining regions in Australia that those home prices have risen monumentally over the last 12 months, doubling in price in some areas a demand outstripped supply. These rises could be in jeopardy. If you are thinking of joining in on the mining town investment rush it might be better to wait and see a settled trend in commodity prices first.