We are seeing an example of this in Sydney and Melbourne at the moment. And most of our cities have seen falls in housing prices at some point over the past decade. While I would expect housing prices to trend higher over time as our incomes increase, there is no guarantee that your home will be worth more tomorrow than it is today.
So plan accordingly. The third point is closely related. Make sure you build adequate financial buffers into your plans. Things don’t always turn out as we expect. So for most of us, having a buffer against the unexpected makes a lot of sense. We all need to prepare for that rainy day.