"We've almost got the perfect storm," says veteran fund manager Brian Gaynor as he reels off the many reasons New Zealand house prices and debt levels are soaring to precipitous heights.
There are many ingredients. But right now, New Zealand seems to have them all: not enough building, restrictions on development, surging migration, baby boomer savings, low interest rates and banks that are all too happy to lend for property investment.
"When you get the perfect storm like we did in the 1980s with the sharemarket, you see things just go up and up. People start to believe they will never fall," he says.
"People didn't believe the sharemarket would fall in the 80s. I'd come in from a trip to Australia and the guy at customs wouldn't let me in unless I gave him sharemarket tips.
New Zealand's gross debt is a whopping half trillion dollars; housing now accounts for $218 billion of that.
As of April that housing debt was growing at an annualised rate of 8.3 per cent -- and that rate is accelerating.
The median price of an Auckland house has almost doubled since the bottom of the last cycle in 2009, in the depths of the global financial crisis.
The boom has now spilt over into the regions, with places like Hamilton and Tauranga surging 26 and 23 per cent respectively in the past 12 months.
"When a sharemarket boom nears peak, people get priced out of the market for the top stocks," Gaynor says.
"So they start looking at the stocks that haven't moved and that's what's happening with Hamilton, Tauranga and New Plymouth. They stop buying on fundamentals and start buying because they can afford to get in. That's classic investment stuff. Its nothing unique to housing."
But right now there's no question that it's housing that poses New Zealand's biggest debt risk, he says.
The big problem, says economist Shamubeel Eaqub, is that we have a banking system designed to view lending for property as less risky than other kinds of lending.
"Our banking regulation allows us to feed on the property market," he says.
"Of all the debt that is created in New Zealand, more and more is going towards mortgages because mortgages are less risky according to our rules and regulations."
As house prices soar, the size of mortgages has to grow with it.
There is no easy way out of the cycle. If house prices fall, then highly leveraged investors and many home buyers will be left exposed.
In the 1980s everyone was talking about the sharemarket. Now everyone is talking about the property market. "When it happens it will be nasty," says Eaqub.
"There is no other way to describe it. What we have built up is ugly."
What happened to the US housing market in the global financial crisis provides a sobering example. But in New Zealand it could be even worse.
"In the US, and particularly in places like Nevada and Las Vegas, they had this massive housing boom and then the entire economy cratered."
In mid-2006, Nevada median house prices peaked at close to US$350,000. By 2012, after the GFC, they finally bottomed out -- down 64 per cent at US$125,000.
But one thing favouring the Nevada home owners -- and those in many other US states -- were laws that allowed them to walk away from a debt-laden house.
In those states, if a property ends up worth less than the mortgage, the homeowner can effectively post the keys back to the bank and leave their debt behind them.
In New Zealand there's no such escape: the debt stays with the borrower.
"In terms of the chilling effect on the entire economy it's much much bigger," Eaqub says. "In Vegas people had these enormous debts that they knew they'd never be able to pay back. In New Zealand people know they have to pay it back."
A crash would result in distressed selling and a huge slump in consumer spending, "which can have a long drawn-out effect on the economy."
That was exactly the problem in Ireland, says Gaynor.
After the GFC house prices in Dublin slumped 57 per cent from their peak and apartment prices were down more than 62 per cent.
"The worst thing about Ireland was for the young people," says Gaynor. "When the market crashed the biggest thing was the lack of mobility they had. There was no way to sell a house because if they sold they had to crystallise the losses. They were stuck."
"It's not just a Kiwi thing," says Auckland Business School's Professor Robert MacCulloch when asked about our modern debt culture. "It's tied to the rampant consumerism. People are not great savers and it is tied to the saving issue. But Kiwis are not great savers."
For the record, the New Zealand Bankers Association says banks are highly conscious of risk around mortage lending. Chief executive Karen Scott-Howman says it is important that they "got it right" with the individual stress tests they do on all mortgage lending.
She also notes that funding ratios have improved, with banks getting a smaller proportion of their funding from offshore than they did before the GFC.
Bill English certainly remains adamant that individuals are best placed to make their own choices about borrowing and spending.
It can be an internal political thing, it can be an economic thing, a geo-political thing, but something will happen one day and you don't have any idea what it will be.