The party is finally winding down for our housing market. How severe the hangover is will determine the economy's fate for years to come.

After five years of surging prices, the market value of the nation's homes has ballooned to $7.3 trillion - or more than four times gross domestic product. Not even the US and UK markets achieved such heights at their peaks a decade ago before prices spiralled lower and dragged their economies with them.

After five years of surging prices, the market value of Australia's homes has ballooned to $7.3 trillion - four times our GDP. Credit:Luis Enrique Ascui

Australia's obsession with property is firmly entrenched in our economy and psyche, fuelled by record-low interest rates, generous tax breaks, banks hooked on home lending, and prime-time TV shows such as The Block where home renovators are lauded like sporting heroes.

For many, homes morphed into cash machines to finance loans for boats, cars and investment properties. The upshot: households are now twice as indebted as China's.