“Tell a European you think there’s a housing bubble and you’ll have a reasonable discussion. Tell an Australian and you’ll have World War III.” Jeremy Grantham - https://en.wikipedia.org/wiki/Jeremy_Grantham. Grantham, one of the most famous successful value investors writes regular newletter. In one of those newletters, he provides a set of pointers to help guide good long-term value investing. http://puzzlefinancialadvice.com.au/2018/Grantham/120227_JGLetter_LongestLetterEver_4Q11_Guides_to_long_term_investors.pdf His 6th point is as follows:
Try to contain natural optimism. Optimism has probably been a positive survival characteristic. Our species is optimistic, and successful people are probably more optimistic than average. Some societies are also more optimistic than others: the U.S. and Australia are my two picks. I’m sure (but I’m glad I don’t have to prove it) that it has a lot to do with their economic success. The U.S. in particular encourages risk-taking: failed entrepreneurs are valued, not shunned. While 800 internet start-ups in the U.S. rather than Germany’s more modest 80 are likely to lose a lot more money, a few of those 800 turn out to be today’s Amazons and Facebooks. You don’t have to be better; the laws of averages will look after it for you. But optimism comes with a downside, especially for investors: optimists don’t like to hear bad news. Tell a European you think there’s a housing bubble and you’ll have a reasonable discussion. Tell an Australian and you’ll have World War III. Been there, done that! And in a real stock bubble like that of 2000, bearish news in the U.S. will be greeted like news of the bubonic plague; bearish professionals will be fired just to avoid the dissonance of hearing the bear case, and this is an example where the better the case is made, the more unpleasantness it will elicit. Here again it is easier for an individual to stay cool than it is for a professional who is surrounded by hot news all day long (and sometimes irate clients too). Not easy, but easier.
The best book on asset price bibbles "Manias, Panics and Crashes" was written by Charles Kindleberger https://www.amazon.com/Manias-Panics-Crashes-Financial-Investment/dp/0471467146 . Charles Kindleberger described price bubbles as collective hysterias. As summary of some of the key points from this book can be found here. http://www.businessinsider.com/bubbles-all-look-the-same-2014-8?IR=T
The point here is simply as follows: The inability of most Australians to have a rational discussion about house prices and to consider the possibility that house prices could fall substantially, is a classic symptom that you would expect in a price bubble. I think a big part of why such discussions are more readily accepted in Europe is that in many European countries there is a much fresher memory of major house price crashes eg around 2008/2009 (or in the case of USA 2006-2010).