.
I’m not sure which quote will go down as the dumbest in 2011. Our Prime Minister, Julia Gillard, was the orator of the two that I believe win hands down. The first “there will be no carbon tax under the government that I lead” we all know what happened with that. The second is “the Government remains committed to returning the budget to surplus by 2012 – 13.”

The latter quote was succinctly critiqued by Future Fund chairman David Murray who hit out at the Australian government – Murray slams Gillard’s crisis response: report. Mr Murray told The Australian that the Labor government’s “surprise” carbon and mining taxes were putting Australia’s reputation with international investors at risk at a very delicate time, warning that Australia’s 20 years of continuous growth could come to an end. “I would have thought what’s going on with Europe – even what’s happened to the currency in recent times – would tell us that it can end. Yet there’s no entrenched realisation that this is a very risky position that we are in.”

The reason the Government remains committed to returning the budget to surplus by 2012 – 13 is simple. It doesn’t want the Opposition to run advertising campaigns prior to the next election in 2013, saying that the Labor government is incapable of managing our economy.

BUY PRINT

Budget predictions turned from bad to worse when the ‘World’s Greatest Treasurer’, Wayne Swan, released his Mid Year Economic and Fiscal Outlook (MYEFO) where the forecasts of a $22.600 billion blister predicted in May had blown out to $37.100 billion in November. This prompted an avalanche of attacks (understandably) at the government’s economic credibility. Swan’s pursuit of surplus branded ‘madness’ to put this into perspective after the May budget Alan Kohler wrote on his Business Spectator website BUDGET 2011: On a wing and a prayer. As quick as a flash I eagerly awaited Mr Kohler’s response to the MYEFO: Budget for a fool’s paradise and Wake up for a budget stinker – I loved this observation “Economic growth for 2012 – 13, about which nobody has the faintest clue, has been reduced by 13 per cent to 3.25 per cent. Revenue for that year has been reduced by just 1.7 per cent.”

Over to the ‘World’s Greatest Treasurer’ – Surplus sends message to world: Swan “At a time of heightened global instability, our fiscal discipline here needs to send a message to the world” – the treasurer is now delusional. What is missing is that if the budget is not in surplus by 2012 -13 a resignation will be immediately tendered – no chance of that happening. The graph below identifies Wayne Swan’s bread and surpluses trick I take exception to being treated like a fool.

Stephen Koukoulas wrote on his economics, financial markets and politics blog: Fascinating Fiscal Facts – Who’s addicted to spending and taxing?

• Total government receipts (tax, dividends, fees and the like) was 21.6 % of GDP in 2010 – 11, the lowest since 1973 – 74 when Frank Crean was Treasurer.
• The tax to GDP[ ratio fell to 20.0% in 2010 – 11, the lowest since 1978 – 79 and is a whopping 4.2% of GDP below the record tax to GDP ratio raked in by the Howard government in 2004 – 05 and 2005 – 06. That’s a lesser tax take of around that was taken tax payers during the peak period of the Howard government. As mentioned elsewhere, it is easy to register a budget surplus when you tax the living daylights out of the population.
• Real government payments> (spending) will rise by an average of less than 0.1% per annum in the 3 years to 2012 – 13, the weakest 3 yearly spending growth since the mid to late 1980’s under the Hawke/Keating Government. Never once did the Howard Government deliver a cut in real government spending – in fact real spending grew by a thumping 3.5% per annum for the last five years of the Howard government.
• Payments ( spending> will be 23.6% of GDP in 2012 – 13 around 1.5% of GDP below the average of the last 30 years. In the 12 Howard Government Budgets, spending to GDP averaged 24.2% of GDP: and only in 3 years out of 12 of the Howard Government was the spending to GDP ratio lower than the Gillard Government is projecting for 2012 – 13.
• The 4.3% of GDP turnaround in the Budget balance in the 3 years to 2012 – 13 (from a deficit of 4.2% to a surplus of 0.1%) is the most rapid turn in the fiscal position on record.

We keep reading house prices at risk from Europe crisis so no relief for the 8 biggest losses on Mermaid Beach’s Millionaire’s Row show no post – GFC recovery in sight. A home in Hedges Avenue (sold in 2007 for $17.500 million) has resold for $7.700 million, meaning the price dropped by about $50,000 each week over the four year ownership. In Mosman Billionaire Oatley wine family snaps up Kahala for the best of Balmoral’s boating facilities. The owner paid $22.500 million for the home in 2007 and we estimate it would have re – sold for approximately $18.500 million.

.
In the boom (n) times the top – end properties show the fastest price appreciation where today – It’s an affluent housing correction: Christopher Joye. Mosman is no exception to this rule although we are observing some interesting property market machinations. Another very strong week of sales evidence in Mosman and we can expect this momentum to continue through to Christmas. If we then look at the number of houses in Mosman on the market there is an interesting pattern emerging.

On September 29 2011, there were 106 houses on the market, so watch the weekly pattern since then. 115, 133, 147, 147, 168, 136, 134 and this week 118.

.
This shows finally, that demand is meeting supply which, in my humble opinion, is a most positive sign. Prices can’t go down if stock levels continue to decline. That can only happen when supply far exceeds demand and we are not seeing that as the numbers indicate.

Source: Domain Property Monitors

MOSMAN – 2088

• Number of houses on the market last week – 134
• Number of houses on the market this week – 118
• Number of apartments on the market last week – 118
• Number of apartments on the market this week – 111

CREMORNE – 2090

• Number of houses on the market last week – 15
• Number of houses on the market this week – 14
• Number of apartments on the market last week – 31
• Number of apartments on the market this week – 30

NEUTRAL BAY – 2089

• Number of houses on the market last week – 15
• Number of houses on the market this week – 14
• Number of apartments on the market last week – 100
• Number of apartments on the market this week – 93

For this week’s sales in 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

For this week’s open for inspections – Click Here

It’s been a brilliant year for our Members of Parliament – massive pay rise for MP’s, but travel perks on way out. Last week the ‘shock market’ identified a losing streak shaves $80b off shares only to see on Thursday Australian stocks soar in global rally.

Somewhat reminiscent of the ‘World’s Greatest Treasurer’s’ – Fudge –it 2011.

Next week –our final edition for 2011.

Cheers ^__^

Follow Me on Twitter

2.12.11Robert Simeon1 Comment »

.
Another strange week where the policy makers in reality, would struggle to run a school fete. So step right up, it’s all about hoopla and hostilities. It started with the peculiar (rhymes with Julia) announcement that America was taking out marina space so that it can play battleships and soldiers in the Pacific. So it did not take long for announcements to take front and centre – Obama needs to confront Chinese rather than niggle from the sidelines.

Then surprise, surprise China issues economic warning over US ties in Asia where it became pretty obvious that cosying up to the US is fine, but our economic destiny lies with China. Indonesia was not that happy either with this announcement so as quick as a flash Hercules to the rescue as Gillard’s peace offering over US troop build up concerns four C – 130 Hercules worth an estimated $30,000,000 are donated to the Indonesian government as a softener. Australia will now have to replace them and it will cost a lot more than $30,000,000. Hey money’s no object!

BUY PRINT

Then we had to endure a messy mining tax deal sealed in the early hours when it became most apparent that the mining tax outcomes: everyone’s a loser. With many left shaking their heads in total disbelief, Alan Kohler wrote in Business Spectator – mourning Gillard’s mining disaster. “Australia’s effort to levy extra taxes on mining companies has been an unmitigated debacle, capped by the passage early this morning of the Minerals Resource Rent Tax with a further last – minute compromise. It is one of the great lose – lose outcomes. We can only hope the Senate knocks it back.”

Which then became personal NSW’s $900 million mine shaft – Julia Gillard punishes for Barry O’Farrell’s carbon tax offsets. So NSW now appears to be the only state set to be punished after Barry O’Farrell raised royalties by $900 million over three years to offset the cost of the carbon tax. The “world’s greatest treasurer “, Wayne Swan, wrote to Mike Baird warning that he will also be excluded from future infrastructure funding if he does not back down.

Little wonder consumer confidence is down and this resonates through the property markets.

No doubt the Reserve Bank of Australia (RBA) is monitoring this closely and my school of thought is that the cash rate will be further reduced by -0.25 per cent when it meets next month, with another drop in February 2012. This weekend will be the greatest Litmus Test with Melbourne and Sydney ready for spring’s only super Saturday. During the global financial crisis (GFC) Melbourne and Sydney still managed to present three or four super Saturday’s so it will be interesting to monitor the 1,000 auctions in Melbourne and 650 in Sydney this coming weekend. That four letter word SOLD (at best) may be heard 825 times.

Housing recovery to begin in first quarter of 2012, but headlines won’t tell us until later: Christopher Joye given first – home buyers to drive 2012 housing recovery: BIS Shrapnel’s Angie Zigomanis.

Why house prices should recover in 2012: Craig James which is a sound argument that I have been presenting all year. “The housing market is constantly in a tug – o – war between two factors – demand and supply. And really it doesn’t get simpler than that. If there is a limited number of properties for sale and plenty of keen, cashed – up buyers then prices are almost certainly going to be bid up. Similarly if there is an abundance of property on the market and buyers are cautious – preferring to take time to find the ‘right’ home – then prices are more likely to ease.”

We publish the Mosman housing barometer each week so, bearing in mind that Mosman has approximately 4,900 houses ,it is abundantly clear that prices are about to go up given that just 2.7 per cent of available Mosman houses are on the market today.

Source: Domain Property Monitors

MOSMAN – 2088

• Number of houses on the market last week – 136
• Number of houses on the market this week – 134
• Number of apartments on the market last week – 118
• Number of apartments on the market this week – 118

CREMORNE – 2090

• Number of houses on the market last week – 16
• Number of houses on the market this week – 15
• Number of apartments on the market last week – 34
• Number of apartments on the market this week – 31

NEUTRAL BAY – 2089

• Number of houses on the market last week – 15
• Number of houses on the market this week – 15
• Number of apartments on the market last week – 101
• Number of apartments on the market this week – 100

For this week’s sales in 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

For this week’s open for inspections – Click Here

I did chuckle this week when I read Europe’s $287bn carbon ‘waste’: UBS report “Swiss banking giant UBS says European Union’s emissions trading scheme has cost the continent’s consumers $287 billion for “almost zero impact” on cutting carbon emissions, and has warned that the EU’s carbon pricing is on the verge of a crash next year.” Shock horror – Labor dismisses UBS emissions report.

So our Parliament in shock as Speaker resigns which did not come as a great surprise given Speaker deal boosts Labor’s position but tarnishes PM.

The problem for the Gillard government is that it can’t count – Govt’s budget surplus hope over: Deloitte. The reality being “in his latest Budget Monitor, Deloitte Access Economics director Chris Richardson said while that outcome would be politically “horrendous”, a surplus next year was a line drawn in the sand drawn by politicians not economists.” So it will be a case of no Labor surplus delivered since 1989/90 again.

Rest assured, Wayne Swan is the “world’s greatest Treasurer”. I will leave you with this:

If Australia is the lucky country, how come Spain, Italy and Greece are getting a new Prime Minister?

Cheers ^__^

Follow Me on Twitter

25.11.11Robert Simeon7 Comments »

Another mad week in Australia with Qantas (Queer And Nasty Try Another Service) shutting down all operations to create a massive spat with allegations that the government ignored warnings about Qantas grounding: Alan Joyce. We then heard that Qantas CEO Alan Joyce made a phone call to PM Julia Gillard but was ignored. This became all the more ironic when the PM made an urgent call recently to a fourteen year old boy who was arrested recently for buying marijuana in Bali. So Labor’s Fair Work Act has sent a signal that unions are on the way back prompting a savage rebuke with business to fight union Fair Work ‘wishlist’. Now we shall watch and see whether Qantas should compete or die – I think the latter.

Then we had news of a Greek referendum plan plunges markets into chaos prompting European leaders confront Greek PM. It will take Greece more than a few generations to recover from its debt debacle so it makes sense to see them booted from the Eurozone. I thought Charlie Aitken best summed it up when he wrote this week on his blog Ringing The Bell – “The Greeks need to remember they lied their way into the EU, they cheated with the help of Goldman’s to stay in the EU, and now the world is helping them stay in the EU. I strongly suspect the rest of the world won’t put up with any more rubbish from them and hopefully in six months time we won’t have a peripheral fishing hamlet running daily global financial market sentiment.” Touché!

BUY PRINT

It must have been a full moon this week with a November coup plotted on Julia Gillard – pressure on Kevin Rudd to push for top job. This gained further momentum with Kevin Rudd fuels leadership talk by failing to voice support for planned pokies reforms which has the federal Labor on another a hiding to nothing. Australians were then aghast to learn that Julia Gillard vows to double money to IMF – Ms Gillard will tell a session on reform of the IMF that Australia will double its special drawing rights (SDRs) quota – from SDR 3.3 billion (about $5.3 billion) to SDR 6.6 billion (about $10.6 billion). Australia has the most notorious government that thrives on giving other people’s money away.

Then we had some good news as the Reserve Bank of Australia (RBA) cuts interest rates to brace economy facing global headwinds with the cash rate dropping from 4.75 per cent to 4.50 per cent. This was the first cut in official interest rates since the global financial crisis (GFC) 2 ½ years ago and follows rises in unemployment and sharp falls in the prices of key resource exports. In 2012, I predict that the cash rate will end up at around 3.50 per cent so the RBA still has another 1.00 per cent to play with – which is great news for our property markets. For our top end markets to start punching above their weight again, we would need to see our ASX All Ordinaries Index at greater than 5,000 today it is 4,267.6.

The September update for Australia’s official house price index was released this week, indicating that house prices in Australia have continued to fall for nine consecutive months. The weighted average of the eight capital cities fell 1.2 per cent in the last quarter according to the Australian Bureau of Statistics (ABS).

It’s a very hard property market to pinpoint at the moment, with conditions appearing more reminiscent of the housing market in the early 1990’s (better known as “the recession we had to have”). From the above graph you will observe that for the last thirty years, Australian households have recorded record debt. It is somewhat ironic that in the recession of the early 1990’s, the cash rate was at 17.5 per cent where today it stands at 4.50 per cent. There is a dramatic upward trending from 2001 to 2010 although it should be noted the significant debt pay down during the GFC.

The great Australian rental inflation: Christopher Joye “There is a lot of talk about house prices in Australia. We hear much less about rental costs. Importantly for the inflation debate, house prices, which tell us the cost of buying an asset (namely a home), are not included in the ABS measures of inflation. However, the costs of securing accommodation in this country – that is, rents – are naturally a key component of the inflation data. Indeed, rents alone make up 6.7 per cent of the overall inflation index.” This can be explained by the data release that NSW leads revival of first – home buyer market – and the fix is on: AFG. The first home buyer market, compared to one year ago, is up 40 per cent, with NSW leading the charge. Rental escalations are driving the surge into property ownership.

Interesting to observe that new listings for Mosman houses (may) have peaked for 2011, with the number of houses on the market increasing by just one, from last week. More importantly, will the RBA’s cash rate move resonate with purchasers that the cash rate is on the way down and property prices have now technically bottomed? It would be refreshing to think so, although I hasten to add that real estate has never been an exact science. Residential real estate is an emotional acquisition although many have confused the transaction by applying a commercial formula with price determination.

MOSMAN – 2088

• Number of houses on the market last week – 148
• Number of houses on the market this week – 147
• Number of apartments on the market last week – 103
• Number of apartments on the market this week – 110

CREMORNE – 2090

• Number of houses on the market last week – 18
• Number of houses on the market this week – 16
• Number of apartments on the market last week – 34
• Number of apartments on the market this week – 35

NEUTRAL BAY – 2089

• Number of houses on the market last week – 18
• Number of houses on the market this week – 18
• Number of apartments on the market last week – 92
• Number of apartments on the market this week – 98

For this week’s sales in 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 For this weeks open for inspections – Click Here

So has the tide turned? When will the All Ords climb back over 5,000 again? It will happen and we all know what happens to property prices then. Buyers are knocking opportunity instead of seeing that opportunity knocks!

What confuses the issue further is that everyone, for some strange reason, wants to buy in a vendor’s market yet are reluctant to engage in a purchaser’s market. Go figure?

Cheers ^__^

Follow Me on Twitter

4.11.11Robert Simeon1 Comment »

.
The ‘shock’ market was at it again this week as default fears spark $45b sell – off which clearly identifies how spooked the global financial markets are and what lies ahead. Despite an abundance of warnings, such extreme volatility is now a sign of the times while global leaders struggle to find a satisfactory anecdote for Europe to finally face the music. For the moment, let’s just call this ongoing saga The Rock Opera of Europe. In Australia this supports the argument why shares aren’t as safe as houses.

On the home front this week, Australian’s awoke to the headline that ‘Tsunami’ to hit Australian real estate. Forget the headline, this was a comedy of errors. “Australia’s love affair with property is about to turn sour as an ‘economic tsunami’ looks set to hit world markets, American economic forecaster Harry Dent says.” Dirty Harry touched – down in Australia last Sunday to guess what? Promote his book,The Great Crash Ahead – How to Prosper in the Debt Crisis of 2010 – 2012, although no offers yet of free steak knives should you decide to purchase the book – destined for the ‘discount bin’.

Must have been a full moon when Jeremy Grantham from the The Economist suggested that Australian housing is a terrible bubble that will pop, with prices falling as much as fifty per cent – the Australian property bubble can withstand greater adversity. Let’s look at the facts Sydney’s housing shortfall to double by 2014: Urban Taskforce.

BUY PRINT

This week stupidity was obviously contagious housing shortage a myth, bears claim “Australia, where home prices are falling at the fastest rate in more than two years has a glut of properties and is set for a US – style crash, some experts say.” What they didn’t say is just exactly what differentiates an expert from – an idiot? On the flip side in Property Observer this week, Christopher Joye wrote the worse the world gets the better housing will. Property Observerwas on fire this week with talk of a property crash is unfounded and sensationalist: HIA’s Harley Dale. “Australian dwelling prices have, generally speaking, demonstrated what could be most accurately described as a controlled moderation since the middle part of 2010. For example, according to RP Data – Rismark (the most closely watched dwelling price series), the seasonally adjusted hedonic price series for capital city house values declined by 2.6 % year on year as of June 2011. Similarly, national “rest of state” house values fell by 2.5% year on year.” Then Christopher Joye followed up with housing prices at a signal junction “it is plausible that Australia’s currently soft housing market will emerge as a relative winner from any global fall – out, much as it did in 2007 – 08.”

Australian businesses turned sour in August, as global markets tumbled as business confidence sapped by global turmoil. Prompting global economy in danger zone: World Bank chief “Unless Europe, Japan, and the United States can also face up to responsibilities they will drag down not only themselves, but the global economy.” Again on the flip – side consumer sentiment for buying a house at a two – year high:Westpac a house as consumer confidence rebounds strongly in September.

Decades of wealth from boom as commodities exports forecast to hit $480 billion which is an economic transformation unparalleled in the nation’s history with its resources and commodities boom. Australia continues impressive trade run where it has posted a trade surplus in 15 of the past 16 months. Of course this will be detrimental to house prices – not!

One must also not forget that NSW to scrap full  first – home stamp duty concessions for existing homes from 2012 so watch the market run hard up to Christmas with buyers getting in before the changes from 1 January 2012. To see what effect this has on the market it will be interesting to watch the following numbers each week – especially apartment sales.

MOSMAN – 2088

.

• Number of houses on the market last week – 115
• Number of houses on the market this week – 111
• Number of apartments on the market last week – 91
• Number of apartments on the market this week – 93

CREMORNE – 2090

.

• Number of houses on the market last week – 14
• Number of houses on the market this week – 14
• Number of apartments on the market last week – 34
• Number of apartments on the market this week – 26

NEUTRAL BAY – 2089

.

• Number of houses on the market last week – 13
• Number of houses on the market this week – 12
• Number of apartments on the market last week – 79
• Number of apartments on the market this week – 80

For this week’s sales in 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

Julia Gillard’s Fort Fumble was at it again when it was revealed that Labor plans Future Fund withdrawal as it takes aim at budget surplus only to then read that the government denies plans to raid Future Fund. The only problem for Fort Fumble is that Finance Department head, David Tune, had revealed the government’s revenue estimates for 2012/13 included revenue from “the unexpected sale of assets from the Future Fund”, along with the disposal of Defence properties, housing and land. Watch this space – caught red handed one might suggest? The reporting of such information would explain why Fort Fumble announced this week an enquiry into Australia’s media?

Struggling with the truth would have nothing to do with it – or would it? Mining tax rate hits 41.5%: study revealing federal Treasury used an “unconventional” method in claiming the mining industry paid just 27 per cent tax during last year’s heated debate over the now defunct resources super profits tax (RSPT). Its replacement the resources tax could be in for a tough time looks like failing just like its predecessor.

Business failures jump 12% in June quarter compared to 4.1% in the previous quarter which is exactly what a strong Australian dollar will do to some industries.

So get in, buckle up and hold on, as by all accounts we are all in for an amazing ride and one we’ve never seen before!

We are proud to announce that at the Richardson & Wrench Annual Awards presentation last night,we were named number one office in NSW and number one nationally. We would like to thank everyone for their ongoing support.

Cheers ^__^

Follow Me on Twitter

16.09.11Robert Simeon8 Comments »

.
Although the same can’t be said for Julia Gillard’s Fort Fumble – Malaysia solution backfires for government that failed to do its homework. If Kevin Rudd “lost his way”, Julia Gillard’s reign as Australian Prime Minister has been nothing short of an abysmal failure. The Labor government is spiralling uncontrollably on a course of self destruction – déjà vu NSW Labor March election 2011. The stench of failure haunts the ALP where many believe that it will be open season for people smugglers after High Court scuttles Gillard government’s Malaysian Solution. The clock is ticking with a Labor stalwart predicting ten months and Labor’s gone: Richardson.

Julia Gillard not only unpopular, she also lacks authority – John Howard the Prime Minister will now struggle to remain at The Lodge post Christmas. Peter Costello entered the economic discussion this week when he wrote in The Sydney Morning Herald – Without a carbon tax, steel industry jobs might stand a chance. Looking forward, I believe that at this point in time a carbon tax will struggle to see the light of day. It is a case of simply joining the dots given Treasury warned in 2009 of higher Aussie dollars likely impact on manufacturing which in all probability would explain why the government rejects calls for manufacturing probe.

The greatest problem with the Gillard government is that it is politically deaf! To such an extent that Rudd last man standing in Labor rout: poll where Foreign Minister Kevin Rudd would be the only federal Labor MP left in Queensland if an election was held this week. Which got a bit more interesting given former Queensland Premier Peter Beattie will consider a run for Prime Minister. So, Beattie for PM? Gillard laughs it off.

BUY PRINT

Sydney housing property defies national downturn to record price increase RP Data Rismark Home Value Index found defies national downturn to where over the year to July, values in capital cities are down 2.9 per cent. Brisbane – 6.6 per cent, Perth – 6.3 per cent, Melbourne – 4.3 per cent, while Canberra + 1.9 per cent and Sydney + 0.5 per cent which explains why, home loans grow at slowest pace on record. In Sydney we are really witnessing fascinating market machinations where last weekend, Sydney had 362 auctions (down nearly twenty per cent on the same time last year).

Vendors aren’t selling which has led to rents increasing by up to eight per cent over the year an expected result with record low vacancy rates. Urban Taskforce CEO Aaron Gadiel estimates Sydney’s housing supply shortfall at 46,000 homes and predicts it will double within three years.  “We’ve seen three straight months where NSW private sector home approvals have trended down by more than 4 per cent a month.”

The slowing market convincing home owners to stay put which is actually a positive sign where Mosman has the lowest delinquency rate in NSW. Which takes me to a great debate over at Property Observer between Steve Keen and Christopher Joye, when Keen wrote, China our one saving grace as Australia’s debt- driven love affair with house prices faces the chopping block. Christopher Joye responded housing prices aren’t for the chopping block, despite the Steve Keen prophecy. As Christopher Joye points out – “Like most of Keen’s predictions, such as the “best – case scenario’’ during the GFC being 11 per cent unemployment and a recession “more severe than 1990 and lasting 1.5 times as long” (unemployment peaked at 5.8 per cent while there was no recession), his 2008 predictions proved way wide of the mark. For the record, Australian dwelling prices are today 13.3 per cent higher than the level at which Keen put his reputation on the chopping block, and 89 per cent higher than the level at which Keen expected them to be.

MOSMAN – 2088

.

• Number of houses on the market last week – 105
• Number of houses on the market this week – 107
• Number of apartments on the market last week – 99
• Number of apartments on the market this week – 93

CREMORNE – 2090

.

• Number of houses on the market last week – 13
• Number of houses on the market this week – 14
• Number of apartments on the market last week – 30
• Number of apartments on the market this week – 31

NEUTRAL BAY – 2089

.

• Number of houses on the market last week – 7
• Number of houses on the market this week – 9
• Number of apartments on the market last week – 70
• Number of apartments on the market this week – 67

For this week’s sales in 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 It is interesting to note from the past week’s activity that we are starting to see activity above the $5,000,000 mark again.

I was amazed to read Federal MP Rob Oakeshott says Australia should consider a road congestion tax when the reason why we have congestion is because governments have failed to spend on road/transport infrastructure. Obviously, he did not read the article I filed this week on Property Observer – Stupid property taxes should not be a revenue stream for weak governments.

Source: The Australian

Cheers ^__^

Follow Me on Twitter

2.09.11Robert Simeon5 Comments »

Get set for a roller coaster ride through to Christmas (and beyond) where once again it will be the financial markets, not property markets that will attract all the attention. Thanks to the global financial crisis (GFC) we can say to some extent that we have been there and done that – what remains to be seen is how destructive phase ll will be? It looks like being horrific for Europe and the United States.

“A more severe crash than the one triggered by the collapse of Lehman Brothers could be on the way, according to alarm signals in the credit markets. The cost of insuring RBS bonds is now higher than before the taxpayer was forced to step in and rescue the bank in 2008” – market crash ‘could hit within weeks’, warn bankers. This week ANZ chief executive warned World on edge of crisis where he labelled Europe “a mess” and warned that failure by political leaders to tackle economic problems could lead to a much greater global crisis.

Back home there have been some fascinating observations on the political consequences of Australia’s resources boom where the Gillard government is fast-learning that there is more to life than just mining. Labor turns the boom into a crisis a great insight by Paul Kelly, Editor – at – large The Australian. “The crisis now engulfing Australian manufacturing has been long predicted and much foreseen yet the inescapable impression is that our decision – makers have been taken by surprise and are scrambling to do something.”

The government has been caught out and the observers on the hill are not impressed.

BUY PRINT

It would be fair to suggest that we are at critical crossroads although Australia’s public debt to GDP ratio is among the healthiest in the OECD at approximately 22 per cent. Sentiment has Fort Fumble not governing, drowning with Julia Gillard back to rock bottom: Newspoll. The ongoing Craig Thomson prostitution scandal further ignites: hard questions will not go away. I don’t believe it will bring the government down – see you Thomson, raise you Wilkie so Australia’s government now hangs on the actions of just two individuals. The flip side – Crean for PM? Why the bookies think it’s not so far fetched. Whatever the case Graham Richardson says the ‘awful smell’ of the Thomson affair won’t go away. Just over 365 days ago the ‘new paradigm’ is looking as vibrant as Australia’s manufacturing industry.

A minority government has proved to be an abysmal failure which has been reinforced in the polls and the reality that Australia’s Prime Minister has until Christmas to turn things around. If you look at Australia’s political history, John Howard lost the 2007 election when he ran Work Choices. Kevin Rudd was done and dusted on the hopeless handling of the mining tax and Julia Gillard will fall over her carbon pricing scheme.

Source: The Australian

Residential and commercial construction remains in the doldrums, according to the latest ABS statistics new home building slumps in June quarter. Obviously “building a better Australia” does not apply to residential and commercial construction? Three population bubbles will cause housing demand, not supply, to skyrocket even though it’s fascinating that rising inflation makes housing more affordable. Well we are not building, so I have to agree with Christopher Joye that house prices will be 55% higher in a decade.

Last week, we revealed the Mosman clearance rates for houses so this week we investigated the adjusted clearance rates for apartments and townhouses. Having looked at the data results from RWM Research Department, I wonder if Mosman has the lowest clearance rates in Sydney.

Here are the Mosman townhouse/apartment sales from 2001 to 2011 – just like the house statistics they failed to reach 50 per cent.

Source: Domain Property Data

• 2001 – 106 auctioned, 52 sold with an adjusted clearance rate of 44%
• 2002 – 114 auctioned, 66 sold with an adjusted clearance rate of 49%
• 2003 – 96 auctioned, 47 sold with an adjusted clearance rate of 42%
• 2004 – 66 auctioned, 25 sold with an adjusted clearance rate of 28%
• 2005 – 89 auctioned, 31 sold with an adjusted clearance rate of 29%
• 2006 – 74 auctioned, 31 sold with an adjusted clearance rate of 30%
• 2007 – 62 auctioned, 38 sold with an adjusted clearance rate of 47%
• 2008 – 95 auctioned, 43 sold with an adjusted clearance rate of 37%
• 2009 – 41 auctioned, 16 sold with an adjusted clearance rate of 27%
• 2010 – 77 auctioned, 38 sold with an adjusted clearance rate of 38%
• 2011 – 48 auctioned, 23 sold with an adjusted clearance rate of 33%

MOSMAN – 2088

.

• Number of houses on the market last week – 103
• Number of houses on the market this week – 105
• Number of apartments on the market last week – 98
• Number of apartments on the market this week – 99

CREMORNE – 2090

.

• Number of houses on the market last week – 17
• Number of houses on the market this week – 13
• Number of apartments on the market last week – 26
• Number of apartments on the market this week – 30

NEUTRAL BAY – 2089

.

• Number of houses on the market last week– 9
• Number of houses on the market this week – 7
• Number of apartments on the market  – 70
• Number of apartments on the market this week – 70

Now this is where it gets interesting – if the Mosman housing market is as strong as we believe it to be the number of houses available should start reducing over the next month.

For this week’s sales in 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

We have been asked to use our database to try and assist finding Daniel who went missing six weeks ago – so if you please see him follow the contact details on the Facebook page – Daniel O’Keeffe.

Let’s hope that next week, the discussion is about economics and not a politician’s callisthenics with prostitutes.  Or should that be a wandering wallet!!

Cheers ^__^

Follow Me on Twitter

26.08.11Robert Simeon5 Comments »

.
The alarm bells became louder when it was announced last week that Australian GDP had contracted by 1.2 per cent – which quickly brought about the re-introduction of that R word – Recession. Blogs and newspaper reporting ran amok, with some suggesting that the East Coast of Australia was already in recession. This week the Reserve Bank of Australia (RBA) correctly decided to leave the cash rate steady at 4.75 per cent. I don’t believe we will find ourselves in a technical recession although I do concur with the economic analogies that the Australian economy is correcting.  However, I believe (and I’m sure the majority would agree) that the weakest link in the Australian economy is the Gillard government.

Natural disasters dominated our GDP results although it is becoming quite evident that many Australians think the Gillard government is the economic equivalent to Cyclone Yasi.

CEO Pulse: Confidence in Australian economy declines – the latest Business Spectator Accenture CEO Pulse survey shows that optimism in the domestic economy, has dropped 22 per cent, with surveyed chief executives running  companies with an Australian turnover of $100 million or more,– reporting a decline in optimism to 51 per cent, compared to 73 per cent in the first quarter of 2011. The CEO’s estimation of the government’s performance in managing the economy continues its downward trend, with an overall rating of 3.3 out of 10 – the lowest average score since the CEO Pulse survey was established in early 2010.

BUY PRINT

Wategos Beach, Byron Bay – Tim Mooney’s aerial photo library would have to the most extensive in Australia. If you want a special photo click on the link and ask Tim as he probably has it.

Carbon price would not cut jobs, says Federal Treasurer Wayne Swan. One should not forget that when the GST came in, we were assured that it would reduce taxes, only to see the opposite.  Julia Gillard feels the heat over carbon tax backlash as voters call for new election given the carbon price will continue to be increased not decreased. It is an ongoing saga especially when you read Robert Gottliebsen’s piece in Business Spectator A resource tax by another name – “Let’s strip away all the carbon tax political rhetoric. It is becoming clear that the looming carbon tax is simply a disguised resources tax on gas and coal exports. It’s the Ken Henry – Wayne Swan first mining tax all over again but without iron ore and copper.” Wayne Swan is desperate to get the budget back in the black (his ego demands it) and the carbon tax is his secret weapon – it has nothing to do with the environment it’s just another tax. Ziggy Switkowski entered the debate by declaring Refuse the carbon tax’s junk mail.Would we have a carbon tax if the budget was not hopelessly in deficit?  Of course not!

We’re still on track for a ‘big Australia’ by 2050 and it is refreshing to see where our new immigrants are coming from, given the focus on asylum seekers. When immigration heads north of 180,000, Australia’s population will be on track to reach 36 million by 2050. This is scary, given our infrastructure struggles to cope with 22 million. I did notice a missing link in the Migration Roller – Coaster graph is the “other” which contributes nearly one – third at 94,178? “Australia’s national infrastructure policy should be managed in the same way as monetary policy – by an independent body removed from politics” wrote Alan Kohler – Infrastructure too important to be left to politics.

I totally agree and I can see the advertisement – Wanted: A government that can read an economy!

Jonathan Chancellor’s Property Observer launched this week to rave reviews. In terms of subscribers, it has taken Virtual Realty News eleven years! Property Observer has all but eclipsed our subscriber numbers in the space of days. For all the property voyeurs who can’t get enough of Australian real estate reporting, subscription is a must and it’s  free!

House prices can’t go up indefinitely although it should be noted that house values spend a significantly greater time in the black than in the red – just that we read more when it ventures into the red! The ongoing debate is that Australian house prices are over- valued – however when this happens we see panic-selling, where supply well and truly exceeds demand.

To put this into perspective, Christopher Joye wrote this week in Property Observer – Aussie housing stock is not too expensive. “One of the reasons banks have been prepared to lend so much for so long is the fact that borrowers have historically been vigilant in paying off these loans. Today there are slightly more than 30,000 borrowers who are more than three months behind on their home loan repayments, juxtaposed against a total pool of roughly 4 million to 5 million borrowers. That is, Australia’s “mortgage default rate” is a paltry 0.7%, despite our internationally high lending rates. This is less than one – 10^th and one – quarter the equivalent US and UK default rates respectfully.”

Our local real estate markets are definitely not panicking and volume is the key performance indicator.

MOSMAN – 2088

• Number of houses on the market last week – 118
• Number of houses on the market this week – 107
• Number of apartments on the market last week – 96
• Number of apartments on the market this week – 97

CREMORNE – 2090

• Number of houses on the market last week – 17
• Number of houses on the market this week –  17
• Number of apartments on the market last week – 37
• Number of apartments on the market this week – 42

NEUTRAL BAY – 2089

• Number of houses on the market last week – 13
• Number of houses on the market this week – 11
• Number of apartments on the market last week – 66
• Number of apartments on the market this week – 63

For this week’s sales in 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

Property above all things is my passion, so I found it very difficult to resist Jonathan Chancellor’s invitation to become an Observer, by regularly contributing articles to Property Observer.

Jonathan did express some concerns about my writing style (I believe he was politely referring to my political attacks). I referred him to this month’s Real Estate Institute of NSW Journal that ran the story “In blog we trust”, which was a critique of Virtual Realty News.

“The online revolution has changed the way real estate agencies do business. And you can be even more effective and successful by creating a specialised blog.” I did, however highlight “A mixture of local real estate news, statistics and astutely directed political comment. Virtual Realty News has generated not only a solid fan base, but has also brought the agency some very tangible benefits.”

Subscribe to Property Observer and read it for yourself next week. I’m still deliberating – should I go hard or adopt a ‘softly softly’ approach?

I will note your advice on our blog.

Cheers  ^__^

Follow Me on Twitter

10.06.11Robert Simeon10 Comments »

.

It’s the state Fudge–it week and Fort Crumble was on a roll. We’re not talking about polls either, thanks to asset sales and a property recovery leads surge into surplus. Our economy expanded by 4.4 per cent which is the fastest growth since 2007 – 08. So why was the Fudge–it not constructive, given housing all over Australia is showing alarming structural problems? Whilst construction has expanded in March, April and May it has been modest according to a recent survey conducted by the Australian Industry Group and the Housing Industry Association. Then the Real Estate Institute of Australia – dropped the bomb lowest level of housing commitments since 2001.

Construction activity expands at slower pace where the overall construction index fell 2.6 points in May to 53.2, but remained above the 50.0 threshold between growth and contraction  a strong probability that it will fall below the 50.0 threshold in June. Fort Crumble treasurer announced “the Keneally government is taking NSW forward into an era of economic growth, building a better future for families and businesses of NSW.” Australia is marinated in (hurtful hikes) where on an annual basis the number of new loans is actually down 25 per cent. The Australian Bureau of Statistics released this week that Australia will be home to 11.8m households by 2031 which is up from 7.8 million in 2006 – so why have the ladders disappeared?

Whilst new home buyers big winners on the Fudge–it, I’m not sure that the NSW Home Builders Bonus is the answer. Morphing First Home Buyers into ‘Residents Over 65 Buyers’ (as long as the acquisition is off the plan) is intriguing as seniors’ duty cut lacks stamp of approval. The former proposal was to entice people into the market and the latter, directed to people already in the market. These new subdivisions are well west of Sydney and plagued with massive transport infrastructure neglect. In May, apartment construction fell 16.8 to see the index now at 42.0 and house construction at 57.7 which is a direct result of a lack of available credit within the Australian economy. This statistic won’t be changing anytime soon.

BUY PRINT

Each week, I challenge Tim Mooney with a photo request and it is plain to see that he has on file, Australia’s largest aerial photographic library.

What Keneally and co achieved … and what they didn’t where simply put: “Kristina Keneally and her Treasurer did little or nothing to bring this revival about. It came thanks to national and international forces beyond their control.” I would call that constructive criticism because one major element that NSW keeps missing are those builders’ ladders. It is all very well to roll – out Stamp Duty relief announced for some buyers however let’s not forget that in May 2010 Fort Crumble introduced its Ad Valorem tax increase of 0.2 per cent for properties between $500,000 and $1,000,000, and 0.25 per cent for properties above $1 million – on top of the usual Stamp Duty fines that were not reduced in the Fudge–it.

Here we have construction being dominated by the public sector over the private sector – so on with my missing ladder concerns. Alan Kohler on his Inside Business programme spoke with Nicholas Collishaw, Mirvac managing director. A great interview Nicholas Collishaw on encouraging development. Alan Kohler, “Australia is experiencing a dire shortage of houses – 40 – , 50,000 completions short of what the actually needs.” Nick Collishaw “Well, I certainly agree with that statistic. We expect a shortfall of 45,000 dwellings for the 2009 year and, as we see 2010 unfold and ’11 ahead of us, that gag increasing.” A must read, as too on Inside Business Christopher Joye discusses lower house prices given the headline mortgage rate has moved from 5.75 per cent to 7.4 per cent. Ironic, that property developers are finding it increasingly difficult to draw credit given no access to the housing emergency chest of funds. Conflicting in that The Emperor PM to pour $5.6 bn into poll fight a decision that shattered faith in PM.

Melbourne close to overtaking Sydney so up the ladder Melbourne goes and down the ladder Sydney goes because of its property structural problems. “With annual population in Victoria running at 2.2 per cent and driving demand in Melbourne, when compared with New South Wales 1.7 per cent growth, it is not hard to imagine Melbourne soon seriously challenging for the crown of Australia’s most expensive median priced city.” Whilst Sydney has a greater proportion of apartments (26.5 per cent compared to 16.7 per cent for Melbourne), Melbourne actually has more houses than any other city in Australia. Although it should be noted that infrastructure determines property values – position, position, position. So why do respective governments find themselves in opposition as against market directing? That would be political bias coupled with ignorance and an extension ladder aimed at re-election. Propping up marginal seats is not the answer given the vast majority of those constituents have re-located elsewhere across Australia.

A reason why the electorates are at loggerheads with The Emperor and his ailing Fort Fumble is exemplified, as he presides over a government that knows best. Trust the government? Not now whilst the result is clear: voters are fed up. Rudd set to lose election on mining tax Australia needs to get back to basics – why is our building demographic market contracting? It certainly does not help when lenders say no to loans as buyers knocked back as consumer sentiment drops in June. There is no doubt that Aussies are cautious after rate rises: RBA which was reinforced this week when RBA governor announced cut debt, save more: Stevens.

It is possible that never before, has Australia vented such anger at Fort Fumble and Fort Crumble – watch the Penrith by-election next week which will identify a record swing against the Premier Pristine government. Sovereign debt capitulations resonate through markets evidenced home loans drop to 9 – year low which represents the fewest number of new loans for owner–occupiers since 2001 and the seventh straight fall in housing finance commitments.

I’m sure that everyone was amazed to read this week lawyers consulted on sacking NSW government, says Governor whilst (not surprisingly) it does identify just how bad our governments are at present. I leave you with this comment from Alan Kohler on Inside Business Talking Point which says all about the RSPT. As Clint Eastwood once said “Do you feel lucky punk?”

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

Follow Me on Twitter

11.06.10Robert Simeon11 Comments »

.
There is no doubting the volatility of home prices and this became more evident when the Reserve Bank of Australia (RBA) decided not to increase the official cash rate. The new money in our property markets is under serious threat. So too, are the financial institutions which can ill afford a reverse in property prices. These very markets were in growth mode during the global financial crisis when the established (old money) property markets went into actual decline. The RBA is now faced with a real estate conundrum as is the Australian Bureau of Statistics (ABS) with reporting accuracy.

Christopher Joye wrote in Business Spectator this week “ABS overstates house price growth” – “the ABS’s median price numbers are being artificially inflated by the fading of first timers, who are being replaced by up graders buying more expensive homes.” Which is exactly what happened in Mosman last year as the market awoke from the GFC (from June onwards) as did the majority of top-end property markets. Joye wrote “While the ABS results will no doubt trigger the inevitable media excitement, the hard empirical fact is that Australian homes have been recording consistent capital growth of about 2 – 3 per cent per quarter since the start of 2009. It is comforting to note, however, that Australian house price growth has not outpaced the growth in household disposable incomes since around 2002.”

The building in the bottom left hand corner is the clue where Sydney Ports are located – a magnificent heritage building on Sydney Harbour identifying our rich history

.
Tim Mooney Photography

Understandably the media ran amok (trying to get those rivers of gold running again) with the ABS figures – Australian house price index rose 5.6 per cent in the December quarter and the September quarter was upwardly revised to 4.4 per cent. ABS figures in the year to December identified that the house price index rose 13.6 per cent. The only problem is, that ABS figures are not considered as accurate as the other data aggregators.

So let’s take a look at Australian Property Monitors – Domain Property Data (our preferred data aggregator given that they list the actual property addresses for all the properties contained within this report) revealed for Mosman house sales in 2009 – 2008 – 2007 a comparative analysis where you can be the judge.

MOSMAN PROPERTIES SOLD REPORT – (House and Semi only)

.

1 JANUARY 2009 to 1 DECEMBER 2009

.

• Total number offered – 334
• Total number of sales recorded – 303. (31 still unrecorded)
• Total Value Sold – $668,966,377
• Public Auction – 62 properties to a value of $94,857,000
• Private Treaty – 241 properties to a value of $574,109,377
• Median Price – $2,000,000
• Average Price – $2,397,728
• Highest Sale $13,200,000 (RWM)

.

MOSMAN PROPERTIES SOLD REPORT – (House and Semi only)

.

1 JANUARY 2008 to 31 DECEMBER 2008

.

• Total number offered – 360
• Total number of sales recorded – 287
• Total Value Sold – $774,865,612
• Public Auction – 65 properties to a value of $126,645,250
• Private Treaty – 222 properties to a value of $648,220,362
• Median Price – $2,275,000
• Average Price – $2,738,041
• Highest Sale $14,700,000 (RWM)

.

MOSMAN PROPERTIES SOLD REPORT – (House and Semi only)

.

1 JANUARY 2007 to 31 DECEMBER 2007

.

• Total number offered – 456
• Total number of sales recorded – 412
• Total Value Sold – $1,182,372,720
• Public Auction – 132 properties to a value of $292,042,000
• Private Treaty – 280 properties to a value of $890,330,720
• Median Price – $2,300,000
• Average Price – $2,869,836
• Highest Sale $22,500,000 (new record price)

.

Next week Cremorne House and Semi sales

SUMMARY MOSMAN HOUSE PRICES FROM 2007 to 2009

.

It is interesting to extrapolate data post GFC. In 2007 the number of houses offered to the marketplace was 456 and in 2008 the number offered, fell -21 per cent to 360. In 2009, we witnessed market consolidation when 334 houses were offered at a – 7 per cent decline. One must not forget that in 2008 and 2009, scuttlebutt had property voyeurs believing that more than half the houses in Mosman were available for sale (this would equate to approximately 2,500 homes as against the recorded 360 and 334 respectively). Thank goodness one Mosman agency has the technology and desire to set the record straight.

Sold properties in 2007 came in at 412 and dropped -30 per cent in 2008 to 287 then in latter 2009 we saw an interesting turnaround where sales increased to 303 – a +5.5 per cent increase. The same patterns can be observed in ‘total value sold’ statistics when the total in 2007 was $1,182,372,720. This fell -34.5 per cent in 2008 to record $774,865,612. In 2009 we started to see the recovery when total sales were $668,966,377 (this represents a -14 per cent decline). We expect these figures to move back into the black in 2010.

THE AUCTION v PRIVATE TREATY DEBATE IN MOSMAN

.

This is amazing data and before we move further, I must advise that every suburb reports different rates of success. The Eastern Suburbs have very strong auction markets and Mosman is one of the worst performing auction markets in Sydney.

.

Mosman – 2007

.

• Total sales – 412
• Auction – 132 (32 per cent)
• Private Treaty – 280 (68 per cent)

.

Mosman – 2008

.

• Total sales – 287
• Auction – 65 (23 per cent)
• Private Treaty – 222 (77 per cent)

.

Mosman – 2009

.

• Total sales – 303
• Auction – 62 (20 per cent)
• Private Treaty – 241 (80 per cent)

.

Makes you wonder why so many Mosman agents keep recommending auction? I know that regular blogger Patricia will find these statistics of great interest.

So where to in 2010 and what will happen to Mosman house prices? I asked Steve Patrick, one of the most respected agents in Mosman what would happen and here is his response. “After a twenty (20) per cent fall in our market from the highs of 2007 to the end of 2009 (actual registered sales on several properties substantiate this figure), I believe the market bounced back somewhat in the order of five (5) to ten (10) per cent.) The last few months of 2009 confirmed this trend where house prices have now stabilised.

There is renewed confidence in the local property markets from buyers, albeit with caution, where I see our market moving steadily over the next six months with small (but more importantly), steady upward growth. Supply and demand will be the key factor going forward as it always has been. Rarely in my past twenty plus years working in Mosman, have I seen an over -supply, even when the GFC was at its historic peak.”

So there you have it! The Mosman online real estate bible has spoken. This weekend marks our first 2010 experience of buyer reaction/response at our upcoming open houses.

We trust that the data contained within this edition of Virtual Realty News will greatly assist you with your market determination. Rest assured, you will read it first with only one Mosman Agency!

See you on our blog where the Mosman debate continues.

Cheers ^__^

For this week’s recorded Balmoral real estate, Mosman real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate and Cammeray real estate sales www.rwm.com.au/news/

Follow Me on Twitter

5.02.10Robert Simeon14 Comments »

.
The Australian economy is booming with the good news this week from the Australian Bureau of Statistics (ABS) that our gross domestic product (GDP) grew by 0.6 per cent (seasonally adjusted). There were no downward GDP revisions for the March quarter which remained at 0.4 per cent and I fail to understand why the global financial crisis (GFC) is still being compared to the worst global economic downturn since the Great Depression. The recession of the early nineties plays it off a break, but the early nineties could hardly be described as global either. Unemployment this time didn’t climb to eleven plus per cent (5.8 per cent as at July) and interest rates today remain at 49 year lows.

‘The Punch’ (another great online read) – Clive Mathieson wrote, What Recession? “What a lovely recession we’re having. Or not having”. I do agree however, with the school of thought that we will see some economic tremors along the way and this is inevitable given the sudden impact of the GFC.

Just like the Y2K computer scare – remember that? A global electronic meltdown was predicted when we moved from 31 December 1999 to 1 January 2000, over concerns that (to save computer disk and memory space), computer softwares were using two digits to represent a year (98 instead of 1998). For example the difference between 1 January 2000 and 31 December 1999 could be calculated as -100 years as against one day. On the stroke of midnight on 31 December 1999 it was predicted that this computer bug would see businesses and industry decimated and we would see planes falling from the sky. On the stroke of midnight, planes flew, fireworks went off over Sydney Harbour and computers worked fine.

Tim Mooney Photography

www.timmooneyphotography.com

Alan Kohler wrote another wonderful article “Bulls at the Gate” on his Business Spectator website. “But Australia’s June quarter GDP is important for two reasons: it confirms that Australia has not had a recession at all, and indeed the economy has now expanded for 18 consecutive years; and secondly it will help ensure that business and consumer confidence remains strong.”

As quick as a flash Wayne Swan announced that our economic growth (Australia has been the best performing advanced economy over the past year) was a result of the stimulus. Earlier in the week he said that opposition treasury spokesman, Joe Hockey, must be “deaf, dumb and blind – if he thinks the Government’s economic stimulus is not working.”

I did like this comment “There are tradies all over the country who are working on stimulus projects. It’s adding to confidence in a way that we don’t see anywhere else in the world.” True Wayne – but other countries are actually in recession – we’re not! Then we had some economic speak from the King of Spin, Ruddy Fantastic, who said “The figures (GDP) that have been released today indicate that we’ve got a long way to go when it comes to economic recovery.” Translated, that means we have a long way to go to get his budget into surplus again.

Leo Shanahan penned this beauty in The Punch “Rudd’s secret spending freeze: no soup for you”

Whilst on long roads, spare a thought for the Y2K equivalent of Australian economics Steve Keen who, in my opinion, irresponsibly predicted on nearly every available media outlet, that Australian house prices would fall by 40 per cent and unemployment would shoot through the roof to “depressionary” levels. This prompted Rory Robertson (interest rate strategist) to jump from the factory floor at Macquarie Bank to bet Steve Keen that if his predictions proved correct he would walk from Canberra to Mount Kosciusko. To read about the bet, Business Spectator filed this story by economist Christopher Joye – “Let the Kosciusko march begin” For the record, Rory Robertson was spot – on with his GFC commentaries.

This takes me to the cash rate which remained on hold when the Reserve Bank of Australia (RBA), met this week and decided to leave it at 3.00 per cent. The cash rate has remained at 3.00 per cent for five consecutive months and next month, I predict it will move to 3.25 per cent – the cost of bank funding is going up not down.

Rory Robertson has also predicted a 25bp increase on October 6 based on the latest data identifying a strong rise in house prices. He wrote “With the RBA reportedly keen to start tightening its loosest – ever policy stance at the earliest – available opportunity, the combination of (a) rising GDP (b) a brighter investment picture and, now (c) stronger growth in house prices, might well prove irresistible. The “economic emergency” clearly is over, “nipped in the bud” by early timely and forceful monetary – and fiscal – policy action.”

I believe he may have been referring to the July RP Data – Rismark Hedonic Index results that revealed Australian home values are now 1.8 per cent above their previous peak in February 2008. The intrigue is building for our Mosman markets given we have record high rents and record low levels of stock – better known as a heated market. Stay tuned.

Quite amazing that should the RBA increase the cash rate next month, it would be moving in a totally different direction to Fort Fumble – Ruddy Fantastic’s empire! That’s it! Ruddy Fantastic is out and now he will be called The Emperor – given his ‘sweet and sour’ patterns of behaviour.

Spare a thought for ‘big’ Johnny Della Bonka at Fort Crumble, where we saw the battered draw bridge rise (figuratively speaking). This prompted a vote of no confidence by the opposition in parliament this week – which failed. Our elected NSW government failed to produce yet another leadership challenge by the Bonka. Watch Frank “cranky” Sartor exercise his recently acquired power- play: the funnier side of politics where the patients challenge the asylum. The Emperor is far from impressed.

This week, Richardson & Wrench Mosman & Neutral Bay (RWM) released another great online application for our clients – ‘Mohbe’ – mobile phone real estate. Mohbe allows real estate agencies to have their own agency branded mobile phone website for their property listings. The mobile phone websites are viewable through any mobile phone which has an Internet browser and access to the Internet. RWM is Mohbe’s first client in NSW to offer this application. Take a test drive www.mohbe.com/124232

Cheers ^__^

For this week’s recorded Mosman real estate, Cremorne real estate, Neutral Bay real estate and Cammeray real estate sales www.rwm.com.au/news/

Follow Me on Twitter

4.09.09Robert SimeonNo Comments »