SOMEWHAT HAZY – COULD GO CRAZY!

SOMEWHAT HAZY – COULD GO CRAZY!

With the hazy days of summer soon upon us, the burning question will be “how will the respective markets respond to this week’s rate rise” ? With just days remaining before the ‘Governor of Moolah’ hands over his head teller responsibilities to his loyal deputy, many property markets now face an uncertain future. A last minute whinge by Morrie “I’m sorry” for the Prime Minister to intervene in what many believed was a “lay down mazaire” (and they were proved correct) had no impact at all. You can throw in as many bananas as you like, but the simple fact is, that Australians are fast closing in on a trillion dollars of debt and this is what this rise was all about. We don’t expect to see much change in the Mosman market however, as again, investors will continue to bypass the apartment markets and rents will continue to spiral to record highs.

While some prefer to use interest rates as the anchor of the property markets – it is widely acknowledged that the greed of the state government with excessive property taxes, is the underlying reason why NSW is performing so badly. When there are no incentives, certain sectors of the property market fail to attract interest e.g., investors in the rental markets. With the focus on interest rate movements, many forget that the increases for those paying rent, are much more severe from an earnings perspective, than interest rate increases. Unlike interest rates that should remain in a holding pattern for the foreseeable future, rents will continue to escalate as the number of rental properties continue to fall.

The top – end of the market continues to set new records each quarter and the June quarter 2006, was the highest on record. With the recent release of The Dyson Austen top 10 prestige residential survey, the highest recorded sale was $24 million for a waterfront at 9 Wolseley Crescent Point Piper. The top seven sales were all above $10,000,000.

Confidentiality agreements make it difficult to record every sale in a quarter, but we have been reliably informed that Mosman posted three $10,000,000 plus sales. Sydney recorded for the very first time, ten $10,000,000 plus sales in a quarter. To receive the Dyson Austen reports (and they are very worthwhile) go to www.dysonausten.com.au

The online markets also performed at their absolute best over the June quarter, as the market moved away from the traditional newspaper campaigns. Our subscriber sales are now at $521,496,600!

July is usually a quiet month for real estate agencies although this was not the case for us. We posted $28,000,000 in sales for the month. No longer available are 61 Belmont Road Mosman, 24 Morella Road Clifton Gardens, 46 Spofforth Street Cremorne, 108 Ourimbah Road Mosman, 46 Wolseley Road Mosman, 20 Ryries Parade Cremorne, 128 Kurraba Road Neutral Bay, 23 Raglan Street Mosman, 4/5 Ballantyne Street Mosman, 1102/1 Watson Street Neutral Bay, 11 Ellalong Road Cremorne, 15 Shellbank Parade Cremorne and 61 Spruson Street Neutral Bay.

Many thanks to talented architect Peter Tout, who filled in for the last two weeks. The feedback from his impressive articles was fantastic. We will have more guest writers in the future, as important industry news comes to hand.

The upcoming Summer market is fast resembling a very light market in terms of stock levels. It is a hazy market indeed, with early indications that it will be far from lazy and in all probability, a little crazy. Will the top – end replicate the June quarter and post another perfect 10 ? Much will depend on whether vendors leave a few doors open to agents, although at this point in time, it is looking highly unlikely. One thing we do know is that NSW, “the state of decay” will climb further and further into deficit. The increase in rates this week will stymie the NSW economy as this state makes up one third of the nation’s population. For us, we are fortunate that the Mosman dollar remains arguably, (from a housing perspective) the strongest of all property markets. Now if we could convince investors that the state government will not rape and pillage with new taxes, they may venture back into the residential markets. Those saving to buy property would be better off too !!
Cheers ^__^

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