Carrington Clarke

And it's also the major asset by far on the balance sheets.

of all of our banks, particularly the big four banks and Macquarie as well.

I mean, Macquarie is a bit more diversified, but all of these banks have literally trillions of dollars of housing assets underpinning the hundreds of billions of dollars of loans on their balance sheets.

And if those housing assets fall by a significant amount, and it would take a really significant fall, the bank regulator does regular stress tests on this.

And we're talking like

pretty much an Irish style housing crash to get the Australian banks into serious trouble, risk of collapse and that sort of thing.

But if even a more moderate fall does raise the risk that banks will become more cautious about lending because they're taking those losses on their balance sheet.

They're having to write down assets.

They will have increasing loan losses.

So it is a potentially big economic issue.

And an interesting note last week from Westpac's economists,

pointing out that the two biggest impacts they see from these housing tax changes are potentially a 34% fall in investor housing credit, which would be big news for the major banks, and we've seen their share prices sell off significantly, and also a 20% fall in transaction volumes.

from the combination of rising rates, potentially falling house prices, and also these tax changes, which will hit real estate agents really hard.

And I know I can hear the tears flowing from our audience, but transaction volumes are bread and butter for real estate agents.

Sadly, they're also bread and butter for state governments because stamp duty relies on transactions.

So some state treasuries might have to re-evaluate their forecasts.

And it is a risky time to have bought these in because of rising interest rates.

And because the fact, look, Sydney and Melbourne were already well on the way to falling home prices before these changes were even flagged.

As soon as interest rates reversed course and started going up, Sydney was going to have home price falls.

We've seen it before.