Another Saturday, another sign Australia’s property price boom is well and truly over – for now, at least. Only half the properties that went to auction in Sydney and Melbourne on the weekend found buyers. Australian property owners are waking up to the mother of all housing debt hangovers. That’s what happens, you see, when you go on an unprecedented credit binge, fuelled by cheap credit and loose lending standards.

We’re just starting to realise the extent of the binge that has occurred over the past half decade. Sure, some increase in borrowing was to be expected when interest rates fell to record lows. But systemic issues in the way debt has been sold to Australians have begun to emerge.

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The banking royal commission is proving well worth the cost to taxpayers, exposed myriad problems in Australia’s home loan market. These include mortgage brokers with a direct financial incentive to push ever bigger loans and repeated failures by banks to comply with “responsible lending” laws designed to ensure borrowers are not sold debts they can’t afford.

As many witnesses to the royal commission have testified, Australians have a inbuilt tendency to assume that if a bank is willing to write them a loan, they are – by definition – able to fund it. We still think of banks as those trusted institutions of country town high streets – diligent gentlemen doling out wise approval or disapproval of one’s financial position.