Always makes us laugh when people (or institutions for that matter) make predictions about the property market, particularly when previous predictions, were far from credible. BIS Shrapnel were back at it again this week with the release of its latest publication “Residential Property Prospects” wherein it predicts that the Sydney market faces another two years of declining property prices. Not sure what rock they have been hiding under as the Mosman market is at an all time high with record prices being posted. The report goes on to say “Sydney currently remains the most expensive Australian capital and will significantly lag the national recovery”. BIS Shrapnel says the turnaround in Sydney will not start until 2008-2009. This confirms that we, as agents, are turning up to work each day and working in a mirage.

Robert Mellor from BIS Shrapnel said in the 7.30 Report back in 2003 (on interest rates) that “our calculations would be that probably as we get somewhere to above 9 per cent interest rates, so around late 2005 or early 2006, will be the danger period.” He went on to say, “At the moment, our view is rates could go to 10 per cent by the middle of 2006”. Well it is now the middle of 2006 and I have been patiently waiting to address these predictions which, at the time, sent shock waves through the property market. Today, the evidence is anecdotal as rates are at 5.75 per cent and his prediction is a massive 4.25 per cent out. Since that announcement, there have been four +0.25 rate increases which is a far cry from the 21 (+0.25) increases that BIS Shrapnel predicted.

No doubt the Premier of the “State of Decay” would be concerned with these revelations given that Michael “Cost-ya Plenty” blamed the property market for under-performing in recent years which then brought about the State’s budget deficit. The first words in his Budget speech were “ Mr Speaker, the State’s structural dependence on property taxes, the end of the property boom, and significant tax cuts to support growth, means that in 2006-07 the Budget will be a deficit of 696 million dollars”. Wow – one would think that in NSW you only pay taxes on property and everything else is free.

Subscriber sales jumped this week to $509,451,600 when we posted $14,670,000 in sales. No longer available are 11 Ellalong Road Cremorne, 15 Shellbank Parade Cremorne, 61 Spruson Street Neutral Bay, 11 Gundimaine Avenue Neutral Bay, 1/104A Young Street Neutral Bay and 97 Shadforth Street Mosman. Not a bad result considering that some share a belief that our market is in lag mode. Keep reading ‘Virtual Realty News’ where we get the market right every time. The market is simply not as scary as some would have you believe. Although, if we have to wait until 2008-2009 for the market to turn around, all we can suggest at present is that the current market is just another mirage for some and a doozey for us !! Cheers ^__^

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