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Albeit a brief visit (28 hours), it is not that often that the world’s most powerful identity lands on our shores where by the sounds of things Australia is set to become the fifty third State of America. With America’s future lies with Asia – Pacific region, Obama says where in an historic address to the Australian Parliament “As President, I have therefore made a deliberate and strategic decision – as a Pacific nation, the United States will play a larger role and long – term role in shaping this region and its future – by upholding core principles and in close partnership with our allies and friends”. He went on to say the region was crucial to US interests, as the world’s fastest growing region – Obama takes aim at China in new Asian world order.

For those who missed the live speech here is the text of Obama’s speech to Parliament I watched it live and I must admit that it was most impressive as he provided an insightful vision as to what lies ahead. Although Australia’s most irrelevant political party didn’t agree as Greens fury at US build – up which should not come as a great surprise. They should stick to just planting trees.

It has not been a great week for the Greens with Julia Gillard’s backflip on uranium exports to India announcement. Although it will be interesting to watch if this fractures the Greens/ALP relationship?

BUY PRINT

Storm clouds over Europe, but sun is shining elsewhere “The media’s great strength is the speed with which they can bring us myriad details about the latest happening in Greece, Italy or anywhere else. Unfortunately, their great weakness is their inability to digest all that information and summarise what it means. The closest they go is in relaying the opinions of 101 supposed experts from Greece, Britain, America or anywhere else. Listen to more than one or two and you’re soon none the wiser.”  The long and the short of this is that consumer sentiments in Australia have adopted a short trem positioning and not a long term outlook.

Euro crash will scatter debris far and wide – we need to watch the road which prompted “The World’s Greatest Treasurer” to declare ‘Get your act together’, Swan tells Europe. When it became reality that Eurozone third quarter GDP suggests bloc is sliding into recession. Gross domestic product in the 17 – nation eurozone grew 0.6 per cent at an annualised rate during the third quarter, according to figures from the European Union’s statistics agency Eurostat. The weakest expansion since the region exited recession more than two years ago and well below growth rates registered in the US and Japan. The eurozone was spared no favours when the Greek economy fell 5.2 per cent in the third quarter.

The problem is quite simple: French banks are among the largest holders of Italian debt.

On the home front consumer confidence revives after rate cut which would explain the recent spring surge blooms as home buyers dive in. So it is not new money in our property markets when a press release from the Mortgage & Finance Association of Australia announced “first home buyers” have little confidence in the Australian economy, as they baulk at property purchases and hoard their cash.”

Reasons for delaying their entry into the housing market were:

• 72.1 per cent said they were worried about the level of debt home ownership would require
• 44 Per cent said they were delaying purchasing a first home due to economic conditions
• 20.5 per cent of first home buyers felt that property prices are too high

So the Reserve Bank of Australia (RBA) keeps mum on future rate moves although I believe the RBA will cut the cash rate again next month so that they can separate Australia from the Euro crisis and set a solid consumer platform going into 2012. I’m not that concerned by all the rhetoric emanating from our central bank when RBA takes negative line on multiple rate cuts and RBA board split on rate cut. The reality is that the RBA sees housing market as subdued not should we dismiss Economists and traders fighting a false forecasting war: Christopher Joye.

Was it the ‘Obama Factor’ that triggered the greatest trade volumes seen in 2011 this week for our demographic markets? There is not a single market in the world economy that does not fall under the economic equation of Demand V Supply.

So closely examine these figures we extrapolate each week for our readership.

Source: Domain Property Monitors

MOSMAN – 2088

• Number of houses on the market last week – 168
• Number of houses on the market this week – 136
• Number of apartments on the market last week – 138
• Number of apartments on the market this week – 118

CREMORNE – 2090

• Number of houses on the market last week – 21
• Number of houses on the market this week – 16
• Number of apartments on the market last week – 44
• Number of apartments on the market this week – 34

NEUTRAL BAY – 2089

• Number of houses on the market last week – 21
• Number of houses on the market this week – 15
• Number of apartments on the market last week – 136
• Number of apartments on the market this week – 101

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

This is anecdotal evidence that all of our property markets are engaging again and these statistics which are the most conclusive in 2011, prove that our property markets have turned. It will be fascinating to see next week’s results to see if this trending continues – I believe it will. What we are identifying is that our expats are now returning it ain’t working: Aussies abandon the ailing UK job market.

So Julia Gillard closing gap on Abbott: poll although her days are numbered given Bill Shorten firms as PM’s successor. Although the greatest problem they face is over those one – armed bandits ALP carries pokie burden – which won’t go away anytime soon. On a funnier side SLASH AND BURN: Swan plans to cut billions in spending so I assume he is referring to focus groups where the Gillard government spent $33 million last year on market research. They should be reading newspapers although that premise is quickly dismissed given Gillard looking to blame media: Hartigan.

Whilst on the media I have long argued here that newspapers can’t charge readers for online content so I was not surprised to read in Business Spectator when Alan Kohler wrote Will Fairfax break the paywall. As you would be aware you have to register to now read (The Australian) online as Rupert Murdoch proposes that Australian’s should pay a subscription to read his papers online. Online is based on the premise of eyeballs and third party advertising where the more eyeballs the more revenue. The Australian behind a paywall, and so far the three month trial has seen its page impressions decline by 25 per cent – far less than might have been expected. Actually, and certainly less than its traffic will decline once it starts charging.”

No wonder Fairfax Media is reconsidering its online position. The problem for News Ltd and Fairfax Media is that they are still “newspaper thinkers” who believe (incorrectly) that you can still double – dip with advertisers and the readership.

Goes to show you can never assume.

Cheers ^__^

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18.11.11Robert Simeon8 Comments »

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I’ve been obsessed now with the www – (weird whacky ways) consumer online movement for fourteen years. Prior to that, we had black and white television, fresh daily milk deliveries in glass bottles, one telephone per household, wash tub wringers, beta videos and 45 rpm records. We also paid for a newspaper (unless you stole it) and let’s not forget that when you dialled 013 (directories) you were charged for the experience. Today, these, enquiries are made online – free of charge.

CEO’s and business owners are currently struggling to understand the latest online strategies (and survive) and why, their respective businesses are looking pear-shaped. It is happening in television advertising, print media and radio commercials – online advertising has arrived and is taking a significant market share. In fact, it’s booming.

Tim Mooney Photography

www.timmooneyphotography.com

Just look at the profit reporting announcements this week where Fairfax Media posted a net full – year loss of $380 million announcing “unprecedented” declines in advertising revenues. The Seven Network posted a 91.2 per cent decline in full year profit where large losses were proportioned to their ownership of West Australian Newspapers (again citing declines in the overall advertising market). News Corp really brought home the bacon by posting a $US3.4 billion ($4.03 billion) loss citing a downturn in advertising markets and impairment charges. Newspaper advertising strategies require a complete overhaul and it is obvious that the present methodology is becoming irrelevant and too expensive, compared to the alternatives.

Just thirteen houses in Mosman were advertised in last Saturday’s edition of Domain. This prompted me to count just how many houses were advertised on Domain in total. Just 86 – the lowest number in memory. Not at all helpful, was the fact that we sold $17,385,000 worth of houses since last week’s edition of Virtual Realty News. No longer available – 23 Upper Avenue Road, 10 Middle Head Road, 15A Clanalpine Avenue, Sirius Cove, 5 Wonga Road (four sales by electronic advertising campaigns). A clue! $929,190,221 in subscriber sales in the Mosman – Cremorne and Neutral Bay market. As well as the best our online position (database) we have the best negotiators!

It should be noted that our property markets are no longer predictable with the upcoming Spring/Summer market appearing (at this point) to being very tightly held. Open house inspections over before lunch (who would have predicted that?) – changing times.

All arrows keep pointing to Google. It commands ninety per cent of online search enquiries in Australia and it is a no-brainer for any business not to be dominant on the major information highway. Competing search engine Bing (less than ten per cent of searches) has just announced its user-submitted homepage competition, although I remain unconvinced that this photo will significantly increase traffic – it is not the picture but the the content that attracts eyeballs!

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News Limited’s arrows apparently now point to paid online readership when the Los Angeles Times reported “Chief Digital officer Jonathan Miller has positioned News Corp, as a logical leader in the effort to start collecting fees from online readers.” As quick as a flash (and unprecedented – I believe) Fairfax boss Brian McCarthy announced that he was “happy to talk” to rival News Corp about its plan to charge readers who access online news content. Charge for online? I wonder if newspapers will then be free – what an about face. The Internet has simply matured and users have embraced this change in culture. It is now widely acknowledged that the online available resources in modern times are rolling out much smarter user experiences and applications.

Late in 2006 – Google (the monster) acquired YouTube for $US1.76 billion which just so happens to be the Internet’s top video channel. Now YouTube will start paying videographers for their content given they are now accepting page advertisers.

Twitter co-founder Biz Stone also announced that he too would introduce some type of paid content for commercial customers. Richardson & Wrench Mosman & Neutral Bay (RWM) is the only Mosman agency (that I am aware of) using Twitter as Biz identified for his charging model “But we we’ve identified a selection of things that businesses say are helping to make them more profit.” Nothing wrong with a pay to stay model as long as you understand it – I still believe Google will somehow mash YouTube into its real estate model.

So let’s move to the following quote that I read online this week “Web Squared: Web 2.0 Five Years On” (a great read – should you be moving. Please download and read) “Hence our theme for this year: Web Squared. 1990 -2004 was the match being struck; 2005-2009 was the fuse; and 2010 will be the explosion.” In summation the report tells us “If we are going to solve the world’s most pressing problems, we must put the power of the Web to work, its technologies, its business models, and perhaps most importantly, its philosophies of openness, collective intelligence, and transparency. And to do that, we must take the Web to another level. We can’t afford incremental evolution anymore.”

“It’s time for the Web to engage the real world. Web meets World – that’s Web-Squared.”

Every time you open a link, Google rewards that business with a vote that propels it in their rankings for that respective keyword search – the more votes, the higher your business ranking which explains why consumer communication (newsletters) keeps getting voted into powerful online positions on the Google Monster.

Since the unexpected Global Financial Crisis arrived here in Australia our business model has exceeded our expectations (all things considered) based on the results we have delivered in our marketplace. In my opinion, RWM could not be better prepared for the predicted “explosion” next year. Web Squared said “But 2009 marks a pivot point in the history of the Web. It’s time to leverage the true power of the platform we’ve built. The Web is no longer an industry unto itself – the Web is now the world.”

Yes – times change – although not as fast as NSW Labor changes Premiers. Embarrassing, and highlights the gross incompetence at Fort Crumble. Woolworths wants a bigger tool box to nail consumers and speculation that our property market is set for another boom. June quarter GDP figures are released next week – negative or positive? I predict positive although a negative result would put an interesting spin on the micro/macro analogies of economic recovery.

Once www stood for weird whacky ways – now I suggest that www should stand for ‘what (a) wonderful world’. I should register that and remember where you read it first. See you next week and our online business shall forever remain free – another clue.

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/

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28.08.09Robert Simeon11 Comments »

Without doubt the Global Financial Recession (GFR) will re-define outlooks and perceptions and see a vast array of business models challenged as we enter the brave new world. Testing times, but also exciting times which can be lost in a ground swell of confusion. However, despite all the doom and gloom, online technologies continue to add the zoom to our markets.

Such revelations have not been popular with some real estate agencies who will now have to invest (their cash) in costly online upgrades and blogs (we believe we were the first ) to allow subscribers to voice their opinions.

Time heals all markets and this time around (with the benefit of hindsight) on an economies of scale basis, the future looks very bright indeed. One only needs to look at mobile phone technologies to see where we are headed. The race is on to provide consumers with interactive property alerts and I’m not talking SMS either – which failed the consumer test of functionality and appreciation for that matter. Hosting individual media website platforms will be the next initiative for our industry which is fast becoming much more interactive. In time, print expenditure will be reduced with vendors moving to hi-tech video broadcasting that is already much more affordable.

We certainly don’t speak for other businesses, that currently challenge the good, bad and ugly side of the GFR and I believe that the March quarter 2009 will be the worst on our constantly monitored business dashboard. There are signs that real estate markets are getting stronger due to the fact that available stock levels remain tight. Currently, all the buyer action is in the lower price ranges but this action will eventually move to the middle and eventually the top-end markets. Having said that, we believe the top-end properties will identify a capped reduction from fifteen (15) to twenty-five (25) per cent based on 2007 valuations. (It will be interesting to read subscribers’ thoughts on this week’s blog).

Australian Property Monitors (owned by Fairfax Media) revealed that in the March quarter 2009, the number of properties sold in Sydney at auction, fell dramatically. The average price for properties sold at auction in Sydney during the March quarter was $616,237. In the 2008 quarter, it was $786,682. Sales in 2009 were 1,742 compared to 2,230 in 2008.

All things considered, this is not a bad result given that the Westpac Bank – Melbourne Institute leading index of economic activity fell -5.1 per cent in February. A further decline from January which recorded -4.8 per cent, the weakest outcome since 1982. This index has been in negative mode since October 2008 and in all probability, a turnaround could be just months away.

To put this into greater perspective, figures compiled by Treasury identified that the average Australian lost $25,000 in wealth in the past year. Australian residential real estate fell just three (3) per cent in 2008 compared to the United States and United Kingdom where prices fell by as much as twenty (20) per cent. The reason why Australia fared so much better was again, a lack of supply.

Aside from escalating unemployment, a key performance indicator for global recovery, is a strong banking sector and it is well documented that our very own Australian banks are currently positioned as the strongest in the global economy – so why are they delaying our economic recovery?

An analysis by Fujitsu Consulting identified that our banks have increased profit margin on home loans over the past two years. Fujitsu Consulting identified that the major banks are now making at least $450.00 a year more on the average mortgage. Two years ago, which just happened to be the peak of the economic boom – the cash rate was 7.25 per cent. Today it is 3.00 per cent and last week’s Reserve Bank of Australia (RBA) cash rate reductions identified ANZ, Commonwealth and Westpac, cut mortgage rates by 0.1 per cent and the NAB refused to pass on any reduction.

Last week, I mentioned that banks still charge interest rates on credit cards at eighteen (18) to nineteen (19) per cent. This week, the RBA announced that outstanding balances on Australian credit cards presently sit at an all time Australian record of $45.4 billion (multiply that by 18.5 per cent).

Ruddy Fantastic and his government remain tight lipped on this statistic which is understandable given he no doubt read the article published this week by the Member for Higgins – Peter Costello on www.smh.com.au

How immoral, to hold wrong views.

“ I’ve been feeling sorry for Belinda Neal, you will recall, is the Labor MP who let fly at a waiter when asked to move tables at Iguana Joe’s a restaurant/night spot on the NSW Central Coast. “Don’t you know who I am?” she demanded.

Soon all of Australia knew who she was. Kevin Rudd stepped in, reprimanded her and ordered her to undergo anger management consulting.

I’ve never been to this sort of counselling, but I can imagine how it operates. A therapist gives you a tricky case and questions you on how to respond. The idea is to keep your anger under control.

Here’s a case study for Neal. You are flying on your private jet when the flight attendant brings you the wrong meal. Do you (a) eat it anyway; (b) point out you ordered something else and ask for an alternative; or (c) shout at the flight attendant and reduce her to tears?”

Our banks are reducing many to tears and I don’t hear Ruddy Fantastic shouting at them. Obviously they are not on his economic menu. As our headline states, businesses want answers not questions and you can bank on that.

Cheers ^_-^

See you on our blogs – our most popular this week.

1. http://www.rwm.com.au/2009/04/the-power-of-social-networking-on-the-internet/

2. http://www.rwm.com.au/2009/04/it%e2%80%99s-all-about-position-position-position-and-i%e2%80%99m-not-talking-real-estate/

3. http://www.rwm.com.au/2009/04/in-the-business-world-transactions-speak-louder-than-words/

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

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17.04.09Robert Simeon2 Comments »

Already media outlet www.crikey.com.au is referring to newspaper reporting as “recession p-rn” (add an o in the missing space) as it is everywhere. It appears that every “recession p-rn” article appearing on Fairfax Media, News Ltd papers and websites, has resulted in prospective sellers cancelling their 2009 print marketing campaigns and opting for online marketing (the cheaper alternative).

Fairfax Media and News Ltd real estate print revenues will be smashed in 2009 when these (previously) “rivers of gold” will become dry creek beds. Smarter print initiatives need to evolve which, with respect, should have already been released for the 2009 real estate markets. This simply explains why vendors are presently reluctant to engage in costly campaigns – preferring to opt for the high tech online agencies. Our point of difference in this market is our online investment in technology.

Here are the exclusive facts based on sales evidence provided by Australian Property Monitors. The Mosman house market consisting of 4,900 houses would, in strong markets, trade at ten per cent of volume. 2008 was the worst ever recorded year in terms of Mosman house sales where just 219 sales were recorded as compared to 384 in 2007.

Mosman House Sales In 2008

Total sales – 219

Total Value Sold – $580,558,112.00

Private Treaty – 156

Auction – 63

Median Price – $2,376,000

Average Price – $2,870,373

Mosman House Sales in 2007

Total sales – 384

Total Value Sold – $1,153,329,720

Private Treaty – 270

Auction – 114

Median Price – $2,360,000

Average Price – $3,003,462

Mosman, for quite some time, has identified itself as a difficult auction market as anecdotal sales evidence proves.

If you look at the monthly Mosman house sales evidence, the story unfolds in 2008.

January 2008 – 8 home sales

February 2008 – 24 house sales

March 2008 – 24 house sales

April 2008 – 25 house sales

May 2008 – 30 house sales

June 2008 – 20 house sales

July 2008 – 17 house sales

August 2008 – 22 house sales

September 2008 – 13 house sales

October 2008 – 14 house sales

November 2008 – 12 house sales

December 2008 – 9 House sales

These figures will increase somewhat however it is clear that sales volume for Mosman houses in 2009 is obviously well down on previous years. The sales volume decrease in recorded Mosman house sales is 43 per cent down from 2007 to 2008 and 55 per cent down from recorded sales in 2006 compared to 2008. The percentage decreases over the same periods for average and median prices are nowhere as severe. What is blatantly obvious is the fact that Mosman is very much a private treaty suburb and not a public auction suburb which was further evidenced late last year when some clearance rates fell below ten per cent.

Again we are not valuing any mortgagee in possession properties for banking institutions so the ongoing rumours that half the suburb is on the market, is clearly incorrect. Yes – values are down by approximately ten to fifteen per cent however confidence levels are down by over 50 per cent which is an exact reflection of the market.

Another first in 2009 will in all probability see the tightest property volumes offered to the market place in years. What many fail to understand is that house volumes keep reducing not increasing and we know what that does to values. The tug – a – house battle in 2009 will be just as intriguing as probably every other thing that we will observe in the coming year.

We are now into our ninth year of Virtual Realty News and this year will be compelling. Welcome back and cheers! Next week we will look at how Mosman apartments performed. ^__^

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23.01.09Robert Simeon5 Comments »

Today we live in unprecedented times. Never before have we seen monetary policy attacked so aggressively where households (finally) come to the fore – not to be confused with four. I was speaking with a journalist this week about the state of the property markets and said. “They say you have to lose a Grand Final before you can win one. The same can be said with recessions where Generation X is much better positioned (based on previous bear markets) compared to Generation Y – who are experiencing market volatility for the first time and it is not improving – just yet.”

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5.12.08Robert SimeonNo Comments »