Owen Raskovich

So what's the outcome from this prolonged downturn?

Well, according to CBA forecasts, it's a fall of 32%.

Imagine if house prices fell 32%.

To be honest, they're the experts here, but I kind of think maybe that's not where I'd be thinking house prices would go.

I think Australians have an affinity for property, but they're not alone in calling for a pretty steep fall in property prices.

Of course, this wouldn't be the first pretty dramatic sell-off in property prices in the world.

You know, we've got places like Canada and the United States and the United Kingdom and many other Western countries and non-Western countries where house prices have fallen and they've fallen for quite some time.

They've stayed low.

So, you know, I guess this is the modeling that these experts have come up with.

There are other experts that suggest maybe it falls 10%.

Maybe it doesn't fall until we get this six-month bank holiday where people can defer their loans and they're propped up by JobKeeper and JobSeeker, which are great things, by the way.

Maybe prices don't fall for another six months.

In any case, what it is in the headlines is pretty scary.

If you own a property, you're thinking...

Man, this is pretty scary.

Like, imagine if my house fell 30%.

Well, the problem that you have is when you have a property that, say, let's say it's a $600,000 property, it falls 30%, which off the top of my head is $180,000, so you're down to $420,000.

If you've got a loan for $500,000 on a $420,000 house, that's what we call negative equity.

And it's where a house has gone into the negative, meaning that the price, the current price that you could sell that house for is below the loan.

And this is what the banks don't like because then, even if they took the property off you and sold it, they wouldn't recoup all of their money.