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The only problem with writing a weekly blog in the present environment is finding a place to start, because of the constant bungling at both Fort Crumble (NSW Government) and Fort Fumble (Federal Government).

Let’s start with our consistently high performing Fort Crumble where dumping the Metro cost $500 million according to Premier Pristine (Kristina Keneally) “The CBD Metro was a nearly $5 billion project we wanted to be sure as a government it represented value for money.” So we have a $200 million compensation plan from builder Lend Lease and another $300 million had already been spent on the doomed rail wreck. Fort Crumble’s greatest tax payer debacle?

Premier Pristine had her defining plumage ruffled further when she was advised Rudd wants $80 million back as metro bill grows so the train wreck bill has apparently now climbed to $5.3 billion. The Infrastructure Australia money was among dozens of grants shelled out to projects across Australia. The submission by NSW was considered the worst of any of the states. Consequently, only money for scoping studies was handed out. A $5.3 billion tax payer Yes Minister – no brainer!

The Emperor (Kevin Rudd) then took time out from his Doctorate of Medicine studies and if his radical diagnosis proceeds, based on his elective political surgery for our ailing health systems, our States and Territories will need a second opinion. Reductions in Government Spending Tax (GST) appear to be thwarting The Emperor’s prognosis and the diagnosis is a referendum for Dr. Krudd. A bummer for The Emperor as his economic mind sadly lacks the “Midas Touch”.

Buy Print

What a brilliant capture this is. It appears that everything in Australia is climbing. We asked Tim Mooney to make sure that everything was colour coordinated so he had to wait for an aqua car. Each and every business faces a climb back from the GFC and how appropriate is this picture. We have had a number of subscribers contacting us to purchase photos (see our Buy Print above).

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Big Bazza O’Barrell launched his election slogan for next year’s NSW election One year out, O’Farrell picks election slogan “Make NSW Number 1 Again”. Fixing NSW’s economy is the management challenge of our time, wrote Jeff Kennett NSW should look south of the border for the way forward. Jeff Kennett said “I have been asked what I think is necessary and essential for NSW to start rebuilding. It is simple enough, in theory.”

“A new government must be elected, if for no other reason than to end – once and for all – the poisonous culture of self interest that exists among the majority who make up the current government.”

“The alternative government will, over the next 12 months complete (I assume they have well and truly started)– the work needed to immediately commence the reform programme, once in office.”

“This will require a once – in – a generation programme, similar to what we put in place over two terms in office in Victoria.”

A scathing review – “The cost of this entrenched period of failure to NSW and Australia has been monumental. Not only has NSW failed to keep abreast with the advances in thinking and technology, but all basic services that should be provided by government have deteriorated compared with those in other states.”

Charlie Aitken wrote in his Under the Southern Cross – “The political waters are clouded by secret agendas and the political landscape is generally a minefield of broken promises and policy failures. In addition, with a few exceptions, it often appears that the main aim of a politician is to gain re-election rather than pursue genuine political reform.”

The report identifies “Bad Policies” – so look at the failed Emissions Trading System, Pink Batts $2.400 billion debacle (which now requires another $200 million for stuff – up corrections) Fuel Watch and Grocery Watch, just to name a few. Throw in the now growing school halls bungled programme – which will gain greater momentum over time as Ray Hadley at 2GB keeps probing. Julia Gillard says schools building programme saved nation from recession and NSW scraps Hastings Public School project in back flip after critical audit of proposed COLA where a covered outdoor learning area would cost $954,000. A similar structure cost $78,000 back in 2003. Little wonder everything is blocked in the Senate. Government incompetence does resonate throughout the business community – which impacts economic sentiment, growth and confidence.

Bright economic outlook for Australia – Reserve Bank Assistant Governor Philip Lowe at the Reserve Bank of Australia (RBA) said underlying inflation had “moderated significantly” and was expected to decline from 3.25 per cent to 2.5 per cent during 2010. This means that interest rates will move back to normal levels so the 49 – year low of three per cent won’t (in our lifetime) be seen again. Get set for a bank gouging bonanza given Westpac chief warns of need to raise rates although GFC not over, says ANZ chief. Get set for a roller coaster ride in 2010.

Australia’s property bubble: it’s here” it’s official: 60 per cent of investors believe Australia has a property bubble. A confluence of housing shortages, low interest rates, speculative fervour and last year’s move by the Rudd Government to relax the rule of foreign ownership on real estate, has turbo – charged house prices.” I assume they are comparing the property markets to quarter 4 – 2008 although it should be noted that during the global financial crisis (GFC) it was speculated that half of Mosman houses were for sale (2,450) homes and it peaked at 195 homes. I did like this piece in the article “But as John Maynard Keynes famously said: “A market can stay irrational longer than you can stay solvent.” So true – the Mosman market is presently skittish and we are seeing a dramatic increase of foreign buyers moving into our markets.

I have absolutely no idea why The Emperor decided to make the Australian property markets international over local? “The increase in foreign purchasers cannot be underestimated. This abolished mandatory reporting of such acquisitions in a bid to “enhance flexibility in the market”. Absolute rubbish and bulls&%#!

Richardson & Wrench Mosman & Neutral Bay (RWM) are proud to offer “Glen Osmond” to the market place – C 1901 an iconic Mosman home set on a grand estate – “Glen Osmond“.

Is the lifting of foreign ownership a sound decision? We look forward to reading your thoughts on our blog. I tag the politicians so Media Monitors pass on to them, all the comments on our blog.

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Our Australian population hit 22,000,000 this week according to the Australian Bureau of Statistics (ABS) – so what does that do to this supposed bubble?

Cheers, ^__^

This week’s sales Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here

This week’s RWM open for inspections Click Here

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26.03.10Robert Simeon20 Comments »

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I did a Google (Australia’s most visited website) key word search on Global Financial Crisis (GFC) this week and found 33,400,000 results that identify just how popular this acronym has become since its creation in late 2007. Australian Policy Online this week published an interesting report The economic vitality report: the impact of the GFC on Australians. This report draws some interesting conclusions namely:

• The GFC proved to be more a slowdown than a recession in Australia.
• In early 2009, there was a high level of concern regarding the economy. This was short lived, owing to effective fiscal and monetary policy measures, and by the end of 2009 the economy gained momentum (recently confirmed by economic growth data).
• The GFC had a different impact on different age groups.
• Indicative of the success of economic policy, spending across the board increased and spiked, following government cash handouts and tax cuts. There was no evidence of consumers having a frugal Christmas in 2009.
• Even though the economy improved throughout 2009, more consumers felt their personal circumstances had declined.

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With one hundred percent confidence we can advise that this week’s picture is of Garden Island – just don’t ask where the garden or island is?

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Tim Mooney Photography

Whilst in Australia economic growth is expected to continue the latest Westpac – Melbourne Institute leading index indicated that the likely pace of activity three to nine months into 2010 posted an annualised growth rate of 6.3 per cent. This is well above the previous predicted growth rate of 2.7 per cent.

Encouraging – although what we do know is that whilst temporarily marinated in the GFC, Australia has a systemic infrastructure epidemic emerging (actually it has been there for years). Lack of housing will challenge recovery – Reserve Bank of Australia (RBA) assistant governor (economics) Philip Lowe said “the rate of increase in homes has been below the average of the past fifty years, while population has increased at its fastest pace over the same period.”

Stockland managing director Matthew Quinn was much more succinct, declaring that Australia faces a housing affordability “time bomb”. “Australia’s current shortage of 200,000 homes and an annual shortfall of 60,000, would balloon to 800,000 by 2020, if no reforms were undertaken.” This is what I have been saying for ages. The hopeless and misguided Nation Building expend – a – thon is nothing more than an economic embarrassment where housing not schools, should be the priority.

Housing shortage to quadruple Australia’s shortage of available homes will more than quadruple to almost half a million by 2020 if the nation doesn’t increase the pace of construction. The Housing Industry Association (HIA) identified a need for 466,000 new homes to be built by 2020 (currently down by 109,000).

We need a population strategy although Fort Fumble (Federal Government) would point to this week’s announcement by the Australian Bureau of Statistics that new home starts rose by 15.1 per cent (40,022 commencements) in the December quarter of 2009. This is the biggest quarterly increase since 2001 (an 11 per cent increase from the September quarter).
Hold off the celebrations. The real Litmus Test will be revealed with the March quarter results when we see the effect on the real market after the First Home Buyers Grant was removed. More on struggle street as prices, rate rises, the average size of a home loan has risen by forty per cent since 2005. More than half a million Australians are now struggling to meet their repayments according to Fujitsu’s Mortgage Stress survey and rates are heading up not down.

Throw in this week’s announcement from Fort Crumble (NSW Government) that electricity bills will raise by a cumulative total of 64 per cent by 2013. The Australian Chamber of Commerce and Industry advised the RBA this week to hold fire on interest rate hikes until they have a better understanding of the Australian economy. I predict a March quarter decline from the December quarter results for home prices in some areas – given March is the first quarter minus the First Home Buyer Grants.

Our top – end markets will continue to do well because being close to the Central Business District, infrastructure is already in place. However, for those heading west, things can only get worse as all infrastructure initiatives have now been curtailed. Fort Crumble is a classic example as it has absolutely no infrastructure policies on its respective radar. The Australian published this week a very interesting graph that identifies how well our top – end markets are progressing following the GFC Wealthy buyers push prestige prices up.

What can’t be ignored is our congestion problem. Fort Crumble has canned all transport infrastructure initiatives because it is broke. The State of Australian Cities Report identified that productivity growth in Australia’s seventeen capital cities (populations greater than 100,000) was critical to our economy. Australia faces a $20b congestion problem where road congestion, estimated at $9.4 billion in 2005, was likely to rise to $20 billion by 2020. Population boom means double trouble for the west with Sydney’s population due to balloon 40 per cent in 30 years. New forecasts reveal the number of people in the south – west will more than double while those in the city centre will leap 60 per cent. Not a fantastic outlook given Road congestion tax mooted is congestion the toll for a free road? As there will be no need for listening to radio as consumers will be listening to electronic government toll contribution sounds as they drive around Sydney.

MOSMAN HOUSE & SEMI SALES SAME PERIOD 2009 – 2010

1 JANUARY 2009 TO 18 MARCH 2009 – 1 JANUARY 2010 TO 18 MARCH 2010

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• 2009 – Total properties offered 50
• 2010 – Total properties offered 62
• 2009 – Total properties sold 40
• 2010 – Total properties sold 53
• 2009 – Auction 3 sales
• 2009 – Private Treaty 37 sales
• 2010 – Auction 33 sales
• 2010 – Private Treaty 20 sales

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Note: When we publish the weekly sales each week (Click Here). The previous week’s ‘withdrawn’ or ‘passed in’ auction properties (strangely some week’s later) now appear as Sold Auction results.

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• 2009 – Total Value Sold $110,025,000
• 2010 – Total Value Sold $83,754,000
• 2009 – Average Price $2,821,153
• 2010 – Average Price $2,263,621

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We will be updating these sales results every few weeks for your observation.

Figures provided from Domain Property Data

Household finances worsen as rates rise and Wayne Swan has advised that business will be consulted on tax review which will be released before the May 11 budget – so work on May 10 – Fort Fumble refuse to release this working paper (due in March). Even better, the Fort Crumble Fudge-it which is close to being declared as insolvent. Watch this Saturday’s state elections in Tasmania and South Australia with interest.

Kevin Rudd hits new low with voters –  The Emperor can ill afford any huge swings from the Labor faithful given that he is next up on the election front.

Cheers ^__^

This week’s sales Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Balmoral real estate, Neutral Bay real estate, Cammeray real estate Click Here

This week’s RWM open for inspections Click Here

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19.03.10Robert Simeon9 Comments »

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Without a shadow of a doubt that confusion is generated by our dominant media companies that consistently promote zoom and boom for home price growth in 2010 and beyond. You can’t really blame them, given that the global financial crisis (GFC) positioned their real estate business revenues on a hiding to nothing. We are six weeks into the 2010 market and this week’s results were mixed.

External coal – face market examinations can deliver dire consequences where our property markets are mapped on anecdotal market results. Simply put: our property housing market remains a bit skittish and definitely improving. The media companies may well be right although – only time (not crystal balls) will tell. When media companies talk the real estate market up one would be dumb and dumber to assume that vendors are not upwardly repositioning their greatest asset.

In this week’s edition of Virtual Realty News we identify – what’s going up and what’s going down. It’s a week by week proposition given last week the adjusted auction clearance rate in Mosman was 77 per cent then, this week, it dropped to 38 per cent? Next week will probably be a different story.

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Admiralty House is arguably Australia’s most prized real estate holding as identified by Tim Mooney when he captured this amazing shot this week. Hopefully, The Emperor (Kevin Rudd) did not have Pink Batts installed in his Sydney harbourside residence – a question never tabled in Parliament House?

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Tim Mooney Photography

Housing market shows signs of cooling – a frustrating report given that in January (every year) Australians are on holidays. Every year, our two quietest months are January and July, “The Bureau of Statistics says only 667 NSW residents took out construction loans in January, down from a high of 1,270 in September. “ September is a peak month so not exactly an accurate market critique.

Just look at our share market for a clue – weaker economies leave us in their wake.” Australia’s share market has been stalled for six months and has performed worse than many countries that are in much poorer economic shape. Twelve months after the depths of the GFC, the All Ordinaries Index is up 54 per cent from its low, but has improved just 4 per cent since September. In contrast, US shares have climbed 60 per cent since March 2009 and 9 per cent since September despite a deep recession and unemployment at 10 per cent.” A possible answer could be investors grab bigger share of home loans the grab for their largest share of housing loans since 1994.

On the flip – side business confidence at a four month high but growth remains below the highs seen in late 2009, a survey shows. The National Australia Bank (NAB) business confidence index gained four points to plus – 19 points in February. This was the surveys highest level since November 2009 when it also touched + 19 points, which just so happened to be a seven year high. What Australians spent money on during the GFC and why, in most countries it means bunkering down however, Australians went in the opposite direction when in 2009 we spent $5.000 billion on boats, bikes and caravans. In 2008 we spent $3.500 billion!

This is the telling graph given Australian home prices surged 13.6 per cent in 2009. What many are missing, is exactly what triggered the recovery. Earlier this week I was chatting on the phone with a Virtual Realty News subscriber who also happens to oversee one of Australia’s largest mortgage books. He pointed out that as first home buyers entered the market they drove prices up and the recipients then went out and purchased more expensive property. In January this year home loans slump most in a decade falling by 7.9 per cent which was the largest fall since June 2000. “The number of first – home buyer loans as a share of total borrowing edged down from 21 per cent of the total in December to 20.5 per cent in January 2010. Home loans for new houses dropped 13.2 per cent to 2,146 in January, while loans for established dwellings dropped 8.2 per cent to 42,303. The true real estate market grows organically and I don’t support government cash hand outs to entice purchasers, knowing that cash rates will continue to go up – not down.

On the flip – side RBA warns home prices could go higher. Assistant governor Phillip Lowe said if the nation’s population growth remained strong, more of the economy would need to be devoted towards housing, presenting challenges both to labour markets and governments. He must have read last week’s edition as Fort Fumbles (Federal government) have our builders constructing school halls instead of working on bricks and mortar. Liberal backbencher Malcolm Turnbull wrote an interesting piece in The Sydney Morning Herald this week The government throws prudence – and billions – to the wind. Great to see our Virtual Realty News commentaries remain a week ahead of our elected politician’s viewpoints.

We all share an obsession for Sydney’s top end of town property results so here is the Dyson Austen Top 10 Prestige Residential Survey for Quarter 3 – 2009 and Quarter 4 – 2009. The Sydney top – end barometer and the results identify our markets road to recovery.
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Dyson Austen Top 10 – July to September 2009

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RWM led this recovery when we posted $63 million worth of sales in June 2009 and grabbed top spot with the sale of Lodge Road Cremorne (this is the very first time that a Cremorne home has attained poll position). The vendors are subscribers. This survey identifies that the Top 10 was up 7.2 per cent from the previous quarter.

Now we see (with the published results for the December quarter 2009) the obvious upward movement as the economy recovers. The previous quarter’s top sale would have come in at position five. The Top 10 jumped up another 12.2 per cent when compared to the previous quarter so it will be intriguing to see what the first quarter of 2010 delivers. What we see here first hand is our property market recovery from the GFC first hand. For mine: the top end identifies the exact strength of our markets because it is the indulgence market that sets market sentiment. Just as interesting, when Australia was in the midst of the GFC this market all but shut down – a clue. The first home buyers stole the limelight with cash government incentives, marinated with record low rates. Remember also, that The Emperor removed foreign ownership constraints when he dismantled the Foreign Investment Review Board – Top Sydney properties snapped up.
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Dyson Austen Top 10 – October to December 2009

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Great commentaries on our blog regarding last week’s edition. The Henry Tax Review keeps grabbing attention for most obvious reasons. The Emperor was just too busy to release tax review. He was probably engrossed in reading review ‘hollow’ with no income tax re-jig”.

We went further a field for those who love paying tax and are happy to present The Unfinished Business of Australian Tax Reform which is an amazing report by Robert Carling. I loved this quote “Do we really want more redistribution? Don’t we already have too much, in that policy is paying too much attention to re – slicing the economic pie at the expense of making it larger”?

The same could be said about the Federal Budget Stimulus.

Back again next week and we’ll chat further with you on our blog.

Cheers ^__^

This week’s sales Mosman real estate, Cremorne real estate, Cremorne Point real estate, Balmoral real estate, Neutral Bay real estate, Cammeray real estate Click Here

This week’s RWM open for inspections Click Here

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12.03.10Robert Simeon5 Comments »

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I’m not talking about the de-throning of the Minister for Pink Batts (Peter Garrett) debacle either! Rather, just exactly what went wrong with their misguided Nation Building spend fest that has now resonated into a property boom (in some areas). History shows such market movements can be contagious, as was subprime, which brought about the global financial crisis (GFC). Fort Fumble (Federal Government) reacted by directing its spending obsession into schools (with plaques) when in fact, it should have taken aim at our housing, transport and health debacles. What Messrs. Rudd and Swan missed, was that all Australians live in houses, use transport, and do require hospital assistance.  By comparison, a much smaller percentage attends school – another no brainer!

The 7.30 Report ran an interesting piece this week Australian houses amongst least affordable in the world. Its working paper was the latest release of the 6^th Annual Demographia International Housing Affordability Survey: 2010 which is always an interesting read. As Kerry O’Brien stated “There is some concern that this latest property boom again raises the spectre of an unhealthy bubble; but there’s a range of contradictory elements at work that potentially pose a profound challenge for Australian authorities.” In 2009, Australia constructed around 130,000 homes nationally when we needed to build 190,000 to meet population growth. In 2010 it is projected that Australia will construct just 152,000 homes – so Fort Fumble has builders working on schools? Home prices will continue to rise as will rents too! Supply is not even close to meeting demand.

It was Nude Opera this week when renowned photographer Spencer Tunick enticed approximately 5,200 Australians to bare all on the forecourt. A case of love the one you’re with or maybe a case of I spy with my little eye someone beginning with…? The shoot has been called Mardi Gras: The Base.

Tim Mooney Photography

It was another tough week for The Emperor who fronted The 7.30 Report Kevin the confessor and said  “We are taking a whacking in the polls now. I’m sure we’ll take an even bigger whacking in the period ahead, and the bottom line is I think we deserve it, both – not just in terms of recent events, but more broadly.” True, when The Daily Telegraph ran “Prime Minister Kevin Rudd losing support in western Sydney” the Mad Monk seized the moment “Rudd rattled, says Abbott” then The Emperor (later to morph as Dr. Emperor) faced an attack from within “Rudd mea culpas have shot party in foot, say ministers”. Never one to miss an opportunity, I grabbed this comment on The 7.30 Report – Kevin the confessor.

The Emperor “One of the problems that we have had as a government, for which I accept responsibility, is we didn’t anticipate how hard it was going to be delivering things.” PM, this is otherwise known as business acumen. The Mad Monk responded “Kevin Rudd thinks he’s the economic genius who saved Australia from a recession but the public might conclude he’s just won the gold medal for waste.”

With his new policies on the run, now Dr. Emperor is taking a scalpel to our hospitals. Amazing what a difference a week makes. This political operation long overdue and Kevin Rudd to cut away the dead tissue of our ailing health care system Dr. Emperor moved into a totally different theatre, that being the operating theatre – Rudd announces $30.9 funding takeover of the public hospitals where just a week from the Pink batt debacle  Rudd’s hospital reform more radical than 1984 Medicare revamp. So how is The Emperor going to doctor our hospitals? Rudd takes $50 bn from states for hospitals. Not bad, given they are already in deficit with a growing interest payment of nearly $20 billion per annum. We found two great articles that critiqued Dr. Emperor’s health announcement Graphs galore but answers to big hospital reform questions are scarce by Lenore Taylor of the Sydney Morning Herald and Steve Murphy from Business Spectator Balance of Power. Australian states and territories are currently drowning in debt to the tune of approximately $133 billion which is about the equivalent of what Fort Fumble now owes (both increasing not decreasing)

Fort Crumble (NSW government) would be ‘champing at the bit’ given, NSW takes the biggest slice in GST handouts. This no doubt  assisted their  mortgagee – in – possession sale of “NSW Lotteries sold in $1 billion deal”where a confused Treasurer Eric Roozendaal said, “That means total proceeds of the sale of NSW Lotteries for NSW taxpayers of more than $1 billion – money that will go straight into funding frontline services for the families of NSW like teachers, police and nurses, and strengthening the state’s balance sheet.” He later said the sale proceeds would go directly into paying down the state’s debt – a margin call?

Pulling plenty of strings, our “Puppet Premier” then embarked on an estimated $750,000 television campaign in an attempt to convince constituents just how Australian she really is. No mention of NSW Labor just her website Kristina Keneally – although I did notice that our Puppet Premier forgot that when any Premier runs an advertorial they always have our Australian flag in the background – another massive blunder! It keeps getting worse “NSW fails to secure funding for infrastructure” in a staggering admission (not really) Fort Crumble announced that it was awaiting an invitation. Infrastructure Australia then advised that submissions were not by invitation only – Fort Crumble consistently hopeless. Yes Minister!
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So let’s look at what has happened in our Mosman market compared to same time in 2009. Bearing mind that in 2010 some sales are yet to be recorded at Domain Property Data.

Houses – I January 2009 to 1 March 2009 compared to 1 January 2010 to 1 March 2010

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As you can see, it is line ball where we will be monitoring results throughout 2010 and calling it as it is. The Reserve Bank of Australia (RBA) moved the cash rate upwards this week by 0.25 per cent to 4.00 per cent and here is (what the economists said) about this week’s increase. Certainly when the Australian Bureau of Statistics revealed that Australians spent $20.100 billion on a shopping spree in January this did not help the RBA’s decision.

As quick as a flash, the banks jumped on the increase where the standard variable rates are;

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Of greater concern is The Emperor’s move into hospitals and his threat to call a referendum should the broke states and territories not agree. Since Federation, there have been 44 referendums and just 8 have been successful. Success of late, has not been one of The Emperors strong points. Then again it is an election year so anything goes. Policy on the run can have dire consequences. Just look at Fort Crumble selling off state assets.

Our Puppet Premier in white – another clue! That flag was raised years ago so (the Fort has some continuity), what assets are next? What do you think about Dr. Rudd’s hospital announcement? Obviously one week’s work and better known as “policy on the run” to stop his poll haemorrhaging voter dissent.

Cheers ^__^

This week’s sales Mosman real estate, Cremorne real estate, Cremorne Point real estate, Balmoral real estate, Neutral Bay real estate, Cammeray real estate Click Here

This week’s RWM open for inspections Click Here

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5.03.10Robert Simeon8 Comments »