IT IS ALL ABOUT CAUTION – NOT DISTORTION !!

IT IS ALL ABOUT CAUTION – NOT DISTORTION !!

Whilst the local market will soon become distracted by the holiday season, the Expat market is heading home for Christmas. Because of our large Expat database (41 countries), each year we set up a special service for our Expats heading home for the holidays. Our goal is to save Expats time and minimise the hassles of house hunting with our exclusive and innovative Christmas Break House Hunt Service. Here’s how it works… We are asking all house-hunting Expats who are returning to Sydney in December and January, to contact us in advance to ensure that inspections can be arranged.

If you are a local subscriber and would like to add your property to the Expat Inspection List, please call our office on +612 9969 7622

IT IS ALL ABOUT CAUTION – NOT DISTORTION !!
It’s the ‘analysis of paralysis’ again, where the property market again finds itself under the microscope facing its usual dismemberment. When the Australian Bureau of Statistics released the October figures identifying that once again, the Building Approvals still continued to head south, the calls that the imaginary property bubble continues to deflate still remain as the chorus. The reason why Building Approvals remain on the decline is simply because less properties are changing hands and many who purchased, say five years ago, have now completed renovations. Whilst nobody (well most) would agree that prices have remained steady, the numbers of properties sold in 2004 is well down on 2003 sales. Australian Property Monitors statistics show, that in 2003 there were 362 house sales and this year it is 228. The median house price in Mosman last year was $1,593,000 and in 2004 it currently is $1,562,000. In 2003, 277 homes were listed for auction, this year the number fell to 126. We are of the collective opinion that this pattern will continue for quite some considerable time to come. A Westpac economist predicted this week that houses would not return to an annual growth rate of ten per cent until 2008. This is certainly not a negative market positioning, as historically the majority all buy and sell in the same market environment.

The interest rate debate was next on the agenda, with some schools of thought suggesting a rate reduction, whilst others preferred to use the strong investment and employment figures as the reason why we will see, maybe just maybe, a small increase in 2005. The release this week of “News and Interest Rate Expectations:A Study of Six Central Banks” makes riveting reading and is highly recommended for sufferers of insomnia. The writers state that “Central banks around the world have become considerably more transparent over the past decade. An important part of this has been the increased efforts by central banks to communicate their views about economic outlook and its implications for monetary policy.” Well if our ‘Governor of Moolah’ is so transparent, then why do the vast majority get their miscalculated predictions wrong all the time. When it comes to interest rates it isn’t difficult to make a mountain out of a molehill – just add dirt !!

The Real Estate Institute of NSW this week released the September Quarter figures which identified that the annual volume of house sales in Mosman fell 12.12 per cent. The unit sales in Mosman identified an annual volume decline of 33.93 per cent. Overall, Mosman again remained ‘numero uno’ as the most expensive Municipality in Sydney. Whilst house sales declined across NSW by 27.59 per cent it should be noted that nothing happened in July, and we had a Federal Election campaign running in September.

With so much captivating literature available for human consumption, the awaited release of the Annual Report for the Office of State Revenue, certainly mystified many. With property sales still on the decline, the “Blunder Cruncher” of the State’s moolah, delivered another compelling performance. With the budget for NSW 2003-2004 set at $12,803 million, Bobby Dazzler’s boys collected $13,587 million. Yet again, the “Duties” was the star performer with collections of $5,492 million, and expectations were exceeded with the budget set at $4,917 million. Overall, “Duties” were up $333 million on the previous year, with contracts and conveyances up sixteen per cent above estimates. Land Tax came in also over budget at $1,339 million, the budget was set at $1,241 million, in 2003 Land Tax brought in $1,154 million.

Hopefully the market can continue trading for another three weeks, and we can report that it still has life left in it. We have around twelve properties out to contract or under negotiation, so from that perspective we still remain positive. Where many are confused by the true positioning of the property market, the anecdotal evidence of budget surpluses clearly demonstrates that the property market continues to be the star performer in the “State of Decay”.

Many spend too much time addressing possibilities, facts do not change, feelings do !! Cheers and clink, final edition for 2004 next week ^__^

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