The Sydney housing market is experiencing the latter at present after years of riding the former. But he had developed an acute interest in modern finance since the Global Financial Crisis. During a housing boom, banks are collectively willing to lend more because the value of collateral is going up. House prices rise, people are eager to borrow more, banks are eager to lend more, so house prices continue to rise. A housing boom allows the banks to create more credit, which further fuels the boom, allowing more credit creation.

Source: Otago Daily Times December 02, 2018 15:52 UTC