Buyers’ Market Today And A Vendors’ Market Tomorrow?

Buyers’ Market Today And A Vendors’ Market Tomorrow?

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Great to see the brains of one of our most respected business leaders tee – off on Australia’s present political landscape – political complacency ‘failing next generation’, says Don Argus. “The former BHP Billiton and National Australia Bank chief executive said he is concerned about rising government debt and it is “folly” to ignore the trend just because Australia stacks up well compared with other nations.”

“Urgent action is needed to tackle the “ultimately unsustainable” growth in government expenses, it is time to debate the welfare mentality – not just social welfare, but also for industry protection – and the inadequate assessment of the National Broadband Network would not happen in a corporate setting without a shareholder revolt.” Which is a polite upper cut aimed directly at the unprecedented ongoing waste of tax – payer monies.

It was a brilliant read with the common theme (I thought) that it will be the individual businesses that drive Australia’s productivity, not government rhetoric. Describing poor productivity growth as Australia’s Achilles’ heel, Mr Argus says it has been camouflaged by terms of trade. “That means productivity growth must play a greater role in improving living standards.” His comments reflect wider disenchantment in corporate boardrooms with the quality of debate over public policy and the challenges confronting Australia. They will also add weight to concerns raised by other corporate leaders recently, as he singles out two areas that have been lightning rods for business frustration with policy – industrial relations and the carbon tax being threats to productivity.

BUY PRINT

It is almost impossible for businesses to improve productivity when governments – past and present, have been nothing short of hopeless in rolling out infrastructure programs. Greiner hits out over state’s ‘awful’ infrastructure record citing past leaders (in particular Bob Carr) as either politically courageous or cowardly for not privatising the state’s power sector. I can really see a time when governments will appoint a board to make the big decisions simply because politicians don’t have the business acumen to do so in the public interest.

A city split in two worlds of housing pain the recent census results revealed that the weekly rent across Sydney rose more than 40 per cent in the past five years to $351.00 which has created a rent stress zone. To make matters worse Sydney CBD’s apartment market could run out of stock in less than a year: Colliers. With some 75 percent of all mooted new stock already sold, owner – occupiers and investors seeking a newly built apartment have a choice from just 14 residential projects which will only provide an additional 2,186 apartments. To make matters worse apartment construction activity records sharpest fall in 10 months in June: AIG/HIA construction index. To put this in context, the index remains unchanged at 34.8 which is in steep contraction given a reading of 50 or below indicates a contraction in activity. The index has now been contracting for the last 25 straight months, reaching its lowest reading of 28.9 in February 2009. Does the word ‘Productivity’ spring to mind?

This could be the bottom of the real estate market and a good time to buy property – Mark Bouris “through most of 2011 and the beginning of this year, the Australian economy has been hobbled by sentiment. Sentiment is so important for key measurements such as growth and employment. But sentiment is very hard to measure or put a value on.” Not long ago, I was the first to say that the Mosman market had bottomed and the upcoming spring/summer selling market should be the most fascinating we have seen for the past five years. The Mosman housing market set a new record this week with only 70 houses being offered for sale which is just 1.42 percent of the total housing market. Throw in a few more cash rate reductions and the market just went from a buyers’ market to a vendors’ market.

Source: Domain Property Monitors

    MOSMAN – 2088

    • Number of houses on the market last week– 76
    • Number of houses on the market this week – 70
    • Number of houses on the market this time 2011 – 83
    • Number of apartments on the market last week – 85
    • Number of apartments on the market this week – 83
    • Number of apartments on the market this time 2011 – 99

    CREMORNE – 2090

    • Number of houses on the market last week– 11
    • Number of houses on the market this week – 19
    • Number of houses on the market this time 2011 – 15
    • Number of apartments on the market last week – 19
    • Number of apartments on the market this week – 18
    • Number of apartments on the market this time 2011 – 34

    NEUTRAL BAY – 2089

    • Number of houses on the market last week – 14
    • Number of houses on the market this week – 14
    • Number of houses on the market this time 2011 – 7
    • Number of apartments on the market last week – 52
    • Number of apartments on the market this week – 54
    • Number of apartments on the market this time 2011 – 62

    For this week’s sales in Cremorne real estate, Cremorne Point real estate, Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, , Neutral Bay real estate, Cammeray real estate.
    • Click Here

    For this week’s open for inspections
    • Click Here

It will be fascinating to watch the stock levels over coming weeks. When stock levels fall to record lows, it is often indicative of the “calm before the storm” and I can’t see vendors doing much more discounting (in Mosman anyway).

I’m off overseas chasing the sun for a few weeks and as usual, I’m handing over the Virtual Realty News editions to our RWM team. I have advised them that they must keep publishing the weekly property data details, although I can’t see Mosman houses falling below 65. Old habits die hard so I will be barking instructions from my iPad and iPhone.

Cheers ^__^

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