45 percent housing price collapse was least likely scenario: Martin North's 60 Minutes postscript

Martin North says 60 Minutes took the worst case from his four scenarios as the basis of the alarming segment which went to air last night on Channel 9.

"It is not my central scenario, rated only a 20 percent chance, as I made clear when interviewed," he said noting this caveat did not make it to the final cut.

North suggested a fall of 45 percent in home prices would be over three years or so, and require the US financial markets to react to rising US Fed rates.

Click here to enlarge.

"This creates a GFC 2.0." North, a finance sector analyst and principal Digital Finance Analytics, suggested.

The 60 Minutes reporter Tom Steinfort advised "several of the experts we interviewed for this story estimate it could be as much as 40 percent in Melbourne and Sydney, while even the most optimistic property analysts concede there will be a drop of at least 10-15 percent."

Steinfort says he's been spooked by the downturn, holding off his desired property purchase with fiancee Claudia Jukic.

His 60 Minutes report kicked off with a serious inaccuracy.

"For as long as most of us care to remember, or perhaps only as long as we want to remember, property prices in Australia have only gone in one direction, at least in our big cities," Steinfort claimed.

CoreLogic's Cameron Kusher recently wrote a detailed research analysis tracking the current downturn with three downturns since 2003.

North said the figures used in the program did not reflect his “central scenario” and that Channel Nine “chose not to cover” the more likely alternatives.

“My best call would be [property value falls] in the region of 15-20 per cent from top, over two to three years,” he said.

You can read North's full analysis here.