Posts Tagged ‘Global Financial Crisis’

Plenty of Policy and Argy Bargy, Yet Nobody Wins!

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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!

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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 ^__^

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25.11.11Robert Simeon7 Comments »

It’s Up Up And Away Or Out Out And Away!

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!

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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 ^__^

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4.11.11Robert Simeon1 Comment »

The Rocky Road Ahead Will be Bumps and Humps!

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Just don’t rely on your global satellite – its accuracy can easily get you lost! We are now travelling at two speeds and there is no turning back. After all, we are most fortunate to live in the world’s fastest growing economy and should note that house prices merely treading water and unlikely to dive.

This week, the International Monetary Fund (IMF) issues global recession warning that the US and the eurozone are at increased risk of falling back into recession, a move which it says could threaten other economies worldwide. IMF chief Christine Lagarde, said the economic crisis in developed economies had entered a “dangerous new phase” worsened by “feeble political leadership”. No she was not referring to Australia’s very own Fort Fumble!

I then went to Business Spectator to get an Australian interpretation of what the IMF was telling us where immediately, I found fools rush in by Alan Kohler. “Reading the IMF’s latest World Economic Outlook this morning, it’s hard to escape the conclusion that the challenges facing global economic policymakers are simply too much for their brains to manage. The need for massive budget cuts while supporting economic growth, as well as simultaneous loose and tight monetary policy to support the banking system while controlling inflation would be difficult enough if the world had a crop of high quality leaders working together for the global good. As it is we have a bunch of maniacs and fools operating in largely dysfunctional political and administrative structures. As the IMF says: “The risks are clearly to the downside.”

Now keep your eyes on that Rocky Road. There is a beaming light at the end of the tunnel.

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That light? Wayne Swan named world’s best Treasurer by Euromoney magazine or as John Symond put it – “it must have been a pretty weak field”. Charlie Aitken wrote on his “Ringing The Bell” blog “if Wayne Swan’s the best in the world, it does partly explain the mess we find ourselves in.” Probably the most accurate analogy was that this is the Steven Bradbury Award of Finance Ministers.

Let’s also congratulate some of the past Euromoney Award Winners.

  • Euromoney 2006 Best Investment Bank – Lehman Brothers (Gone 2008)
  • Euromoney 2006 Best Equity House – Morgan Stanley (Bailed out 2008)
  • Euromoney 2006 Best at Risk Management – Bear Sterns (Gone 2008)
  • Euromoney 2006 Best at Investor Services – Citigroup (Bailed out 2008)

Honoured as the world’s best treasurer, Wayne Swan is set to give advice to G20 leaders which is like me being selected at five eighth to replace Darren Lockyer for the Broncos sudden death play -off against Manly tonight. Wayne Swan is now speeding down Rocky Road to accept his award although his Howard/Costello budget inheritance may well be lost in the fanfare.

Another week of financial market fear factor: our dollar dives in black day due entirely to the bleak assessment of the US economy as shares plunge below 4000 points. The US Federal Reserve unveiled a $US400 billion stimulus plan which in itself is controversial, with many believing that the troubled US economy needs to self – correct without stimulus. What is happening resonates through our markets as home buyer confidence declining more rapidly: Glenworth. It is much easier to address confidence as against a dysfunctional economy which is not the case in Australia.

To the Australian home front, where I see the biggest problem facing our property markets is centric to confidence as against economic woes. The Global Financial Crisis (GFC) taught us the need to concentrate on balance sheets over easy credit and carrying far too much debt. Australian households have shifted to a much stronger savings regime – demand shifting to services: RBA.

Rich watching their pennies after almost losing their assets and income which clearly demonstrates the levels Australian households will go to so that they can protect their castle. Sydney housing market will weather economic storm: John Symond which was backed up by we can handle this crisis, Commonwealth Bank. At the end of the day the markets too pessimistic on Australia: RBA.

I love this graph – Macquarie Economics Research noted:

  • Consumer sentiment was stronger than expected in September, bouncing 8.1%, following sharp declines in confidence in both July and August. All components of the index improved with expectations of economic conditions over the next 12 months rising by 16.6%. More important, were the 11.2% improvement in households’ perception of their current finances and the 9.5% improvement in expectations for the state of their own finances in 12 months time. This is significant, given that consumption generally follows households’ expectations of their own finances rather than expectations of activity levels in the economy as a whole. Nonetheless, it is worth noting that both of these indices remain 12% below the long – term trend.

Absent a total meltdown, sharp rate cuts unlikely: Christopher Joye which was later reinforced by RBA deputy governor Ric Battellino – Reserve Bank kills rate – cut hope. Predictions of rates dropping to 3.25 per cent in twelve months time, won’t come to fruition and I see this as good news. Why? Simply because Australia’s predicament does not in the least resemble the financial woes that have infected the US and European economies. What we are lacking is that ‘ring of confidence’.

If it does get ugly, our RBA has plenty of room to move on the cash rate – much like March 2008 when it dropped the cash rate from 7.25 per cent down to 3.00 per cent in April 2009. This time around we have the cash rate sitting at 4.75 per cent (since November 2010). If the RBA was slashing the rate, it would be clear that our economy was in serious trouble.

And don’t forget, we have the world’s greatest Treasurer!

    MOSMAN – 2088

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    • Number of houses on the market last week – 111
    • Number of houses on the market this week – 116
    • Number of apartments on the market last week – 93
    • Number of apartments on the market this week – 86

    CREMORNE – 2090

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    • Number of houses on the market last week – 14
    • Number of houses on the market this week – 16
    • Number of apartments on the market last week – 26
    • Number of apartments on the market this week – 33

    NEUTRAL BAY – 2089

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    • Number of houses on the market last week – 12
    • Number of houses on the market this week – 13
    • Number of apartments on the market last week – 80
    • Number of apartments on the market this week – 78

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

Cheers ^__^

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The Rocky Road Ahead Will be Bumps and Humps!

23.09.11Robert Simeon7 Comments »

It’s about to get very interesting!

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.

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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

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• 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

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• 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

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• 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 ^__^

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26.08.11Robert Simeon5 Comments »

Now that’s a knife and a party in strife!

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Little wonder Julia Gillard’s Fort Fumble finds itself in such a dire position on her first anniversary as Prime Minister. No candle or cake cutting (sigh of relief), even worse no partying: Julia Gillard reveals – why I knifed Kevin Rudd. Twelve months on, Julia Gillard and Labor slump to new lows which would explain why, constant internal bickering is the real explanation it’s not personal, it’s  policy – why Labor is flatlining.

When I read Julia Gillard outlines her plans for survival I could not help but notice her quote about the reasoning behind Kevin Rudd’s knifing “it became clear to me in the crucible of those days that the Labor caucus wanted a different path and a different leader.” A contradiction of terms (maybe) as Julia Gillard tells caucus to be patient when the Fairfax – Nielsen poll revealed that Kevin Rudd preferred as ALP leader: poll. The party faithful (tongue in cheek) found very few positives for Gillard in horror poll.

Alas, a year on, Rudd would do things differently which was met with a somewhat tinge of sobriety as the faceless waiters dispensed caucus refreshments consisting only of lemon, lime and bitterness? No thanks, Kevin. Party politics suggests absolutely no renaissance period for their reborn leader unworkable. Expectations of many more lemon twists: given leadership talk is killing Labor, says Peter Beattie, as party rallies behind PM.

BUY PRINT

This is a one – off aerial capture of Royal Sydney Golf Club at Rose Bay. The new swimming pool is ready for summer although I’m not sure what they’re going to construct in the vacant area below it?

Our invaluable Virtual Realty News subscriber mail suggests Julia Gillard has six months to turn the polls around given the Labor Party finds itself at odds (not great ones either). Betstar have Julia Gillard at $1.65 to lead Labor to the next election with Assistant Treasurer Bill (shortening) Shorten next at $4, Climate Change pioneer Greg Combat (I meant Combet) and Kevin (scissor hands) Rudd at $7.50. Little wonder consumer confidence levels are in rapid decline, or should that be a rapid response to economic concerns?

The rise and rise of the Aussie dollar has appreciated 21.82 per cent during the last twelve months which explains why the expats have all but withdrawn from our real estate markets. Manufacturing and retail have been hit much harder which then resonates through to consumer confidence in the Australian economy. The Westpac – Melbourne Institute Index of Consumer Sentiment fell by 2.6 per cent in June from 103.9 per cent in May to 101.2 in June. Trouble looms on the home front which is a natural progression moving on from consumer confidence declines – what remains to be seen is which real estate markets will remain in a holding pattern and those that will endure declines.

Winter chills price growth amid subdued auction sales reveals that in May 2011, the average discount rate for properties was 6.4 per cent, compared to 5.7 per cent in May last year. There is a twenty five per cent increase in the number of properties for sale in Sydney as compared to this time last year – I will get to Mosman shortly. During the first four months of 2011 only 8,271 home loans were approved for first – home buyers in NSW. This was the lowest number of loans recorded for the same period since 2004 and is sixty per cent less than the 20,982 first – home buyers recorded in the first four months of 2009.

Jonathan Chancellor’s Property Observer wrote this week home buyers and investors more hawkish than economists – 83 per cent of consumers expect rate rises over the next year, but that’s down on the 91 per cent recorded in February, according to the latest Westpac Melbourne index of Consumer Sentiment. This explains why the Reserve Bank plays a game of wait and see as household finances dive to the worst in at least 10 years.

I love all this data as it allows Richardson & Wrench Mosman & Neutral Bay (RWM) to sell our market via our online technologies. If you are a purchaser (not just in Mosman) you are correct in thinking a property crash is gaining momentum. If a real estate agency does not use a blog in this modern era it simply identifies how behind the time their business model is – given it is imperative that our demographic market remains educated about what is actually happening in our Mosman market. The real reason why real estate agents don’t have blogs is that they can talk but struggle with writing – criteria just as important given selling is not 100 per cent based on speech.

Margie Blok wrote in Title Deeds last week – Mosman Millions and Modern marvel sold which prompted me to do a Mosman house sales analysis from 1 January to 23 June 2011. To make matters interesting I extrapolated data for the same period in 2010 and 2007 which was prior to the Global Financial Crisis (GFC). Remember there is a twenty five per cent increase in properties for sale in Sydney presently – as compared to this time last year.

Data provided from Domain Property Data and RWM Research this data is from 1 January to 23 June for 2007/2010 and 2011.

Mosman – Total Number of Houses for Sale

  • 2007 – 232
  • 2010 – 208 (a 10 per cent reduction from the 2007 peak)
  • 2011 – 161 (a 31 per cent reduction from the 2007 peak)

Total Mosman Houses Sold

  • 2007 – 211
  • 2010 – 183 (a 13 per cent reduction)
  • 2011 – 118 (a 44 per cent reduction)

RWM Research: The Mosman housing market is actually defying the trending seen in other Sydney suburbs given the available volume of houses for sale is actually contracting.

Total Value of Mosman Houses Sold

  • 2007 – $565,505,720
  • 2010 – $464,616,550
  • 2011 – $198,296,000*

*denotes that 49 houses have entered a zero sale price – the Total Value for 2011 is still months away from final determination.

Adjusted Mosman Auction Clearance Rate

  • 2007 – 40 per cent
  • 2010 – 35 per cent
  • 2011 – 32 per cent

RWM Research: Mosman has one of the lowest if not the lowest auction clearance rates in Sydney.

Mosman Median House Price

  • 2007 – $2,260,000
  • 2010 – $2,200,000
  • 2011 – $2,100,000*

*denotes that 49 houses have entered a zero sale price – the Mosman Median House Price is still months away from final determination.

Mosman Average House Price

  • 2007 – $2,680,121
  • 2010 – $2,685,644
  • 2011 – 2,792,901*

*denotes that 49 houses have entered a zero sale price – the Mosman Average House Price is still months away from final determination.

MOSMAN – 2088

  • Number of houses on the market last week – 104
  • Number of houses on the market this week – 97
  • Number of apartments on the market last week – 99
  • Number of apartments on the market this week – 99

RWM Research: The total number of houses for sale dropped below 100 this week which would have to be the lowest number available in living memory

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 – 38
  • Number of apartments on the market this week – 33

NEUTRAL BAY – 2089

  • Number of houses on the market last week – 12
  • Number of houses on the market this week – 9
  • Number of apartments on the market last week – 63
  • Number of apartments on the market this week – 65

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

Now you have the most exacting explanation of where the Mosman housing market currently sits.

It is precisely twelve months to the day that ‘The Emperor’ Kevin Rudd felt the long blade of Julia Gillard’s knife given “he had lost his way”. The Emperor even had to cancel his one year anniversary which was brilliantly captured by Bill Leak this week in The Australian.

 

The Australian- order Bill Leak’s print

Cheers ^__^

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24.06.11Robert Simeon2 Comments »

An online production: Death of a Salesman?

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Rupert Murdoch once said, “The internet has been the most fundamental change during my lifetime and for hundreds of years”. Someone the other day said, “It’s the biggest thing since Guttenberg” and then someone else said, “No, it’s the biggest thing since the invention of writing.” If that is the case (and I certainly don’t doubt it) it illustrates the numbers in Australian businesses who have trouble reading!

From my perspective, consumers use the Internet to see what’s happening, whether it be social media, online newspapers, online shopping, real estate etc – etc. The secret is growing the audience, otherwise known as Unique Visitors (UVs), which has become a huge problem within Australian businesses as they struggle to formulate effective and successful online strategies. Just look at our retail markets which are being decimated as they struggle to compete with the world’s biggest shopping centre – online! In the last week, David Jones, Coles, Harvey Norman, Woolworths fight for flexible opening hours to compete with internet trade which is an absolute no brainer given Australian shoppers ripped off by retailer mark – ups – Choice. Even Myer tries its luck with using Facebook, Youtube in social media marketing which is quite amazing and retailers must now move to online and not ‘offline’. Although retail sales beat forecasts in April however the simple reality is that Sydney, Melbourne and Brisbane remain in the top 10 most expensive cities in the world as department stores struggle to set sale.

The cost of living in Australia is skyrocketing as is the Aussie dollar, so consumers are cashing in on these new online markets. Consumers in retail are now negotiating online, much like ‘ducks to water’. A click not a salesman’s pitch comes with an online review. How times change – just a decade ago, the Australian dollar was struggling at 47.75 US cents. Today Australian retail is finding it almost impossible to compete, given the Australian dollar is sitting now at around 108.00 US cents.

BUY PRINT

The changing face of online advertising provides a fascinating critique of where businesses need to be: make no mistake, this is not a false alarm. The conundrum facing businesses is, that what is happening today, was never contemplated during those hazy university days. By 2015, what we do today will look like a 1980’s re-run of Homicide.

VIDEO ADVERTISING

 

Google predicts that by 2015, 50 per cent of ad campaigns will include video ads – Australians are now watching almost 1 billion videos online each month. Video based advertising grew by 83 per cent year on year in Australia, total video spend by advertisers equated to 5.3 per cent ($33.4m). This demonstrates just where this industry will be, in four short years.

MOBILE ADVERTISING

 

By 2015, it is expected that mobile internet will surpass desktop internet usage – global mobile advertising spent, will total $3.3 billion in 2011 and expected to reach $20.6 billion by 2015.

Fairfax Media Chief Executive, Greg Hywood, this week announced era of free content is over says Fairfax chief therefore charging users to access parts of the Fairfax website.  Good luck Greg!  I respectfully suggest that you look at your point of difference over your competitors? I can’t think of one, given the current trend is for leading print journalists to move to online models.

Commonwealth Bank still paying the price for November rate stinger a consumer rebuke can cost a business millions in lost revenues (better known as customer comfort).  The Fairfax move could easily result in consumer dissatisfaction. After all the ABC website will always be free. The jury is still out – however the consumer sentencing could very well be terminal.  Which takes me to that other sales pitch.

The dumbest sales pitch of the week would go to Cate Blanchett who, when launching her Carbon Tax campaign said, ‘Say Yes”.  Cate – Australians have no say in the carbon tax and why would you suggest we say yes, when the carbon price is yet to be announced? Even stranger – Australia’s greatest political lie was Julia Gillard’s announcement that “there will be no carbon tax under any government that I lead”.  We don’t get a say with the Carbon Tax but we do have opinion polls.

Source: The Australian- order Bill Leak’s print

 

The March quarter Gross Domestic Product (GDP) was released this week – Economy suffers biggest quarterly contraction in 20 years with a 1.2 per cent decline recorded.  Floods and cyclones severely impacted exports. Whilst many are expecting a positive mining return it should be noted that eight of the nineteen industry sectors contracted in the March quarter. A recession? It’s technically possible “With housing finance falling, retail struggling as consumers reduce their spending and move towards foreign online retail for their purchases, and business credit 1.1 per cent lower than a year ago, it won’t be an easy ride. It will also make Wayne Swan’s budget estimates look increasingly rubbery.”

This brings me to the real estate industry which reminds me of the retail industry – both have no idea about using technology and modern age marketing strategies. Consumers demand facts that are exacting for their very own market analysis. When real estate markets start declining there is an overwhelming tendency by real estate agents to hide and not face the realities of the day.

Real estate agents absolutely hate these graphs as they paint a negative marketing positioning. I happen to love them, because we have a weekly blog and that allows us to defend our real estate markets. Like the GDP figures, real estate markets need to be assessed on a Quarter by Quarter basis too. So let’s look at the Mosman market (data is still not complete, with many sale prices yet to be recorded.) We will compare the Mosman March Quarter 2010 with the March Quarter 2011.

Source: Domain Property Data

MOSMAN HOUSE SALES MARCH QUARTER 2010

  • Total Number Offered – 105
  • Private Treaty – 75
  • Public Auction – 16
  • Total Sales – 91
  • Total Value Sold – $230,950,500
  • Average Price – $2,685,470

MOSMAN HOUSE SALES MARCH QUARTER 2011

  • Total Number Offered – 84
  • Private Treaty – 47
  • Public Auction – 14
  • Total Sales – 61
  • Total Value Sold – $107,071,000
  • Average Price – $2,817,657

RWM RESEARCH – Another 28 sold properties are still to have their sale prices recorded so the Total Value Sold will increase significantly from the current figure of $107,071,000. The Average Price for a Mosman house in the March Quarter 2010 was $2,685,470.  In the March Quarter 2011 it increased to $2,817,657 with a strong possibility that when the remaining sales are recorded it will go higher. In the March quarter 2009 the average price was $2,653,061, 2008 $3,093,770, 2007 $2,617,332, 2006 $2,303,107 and 2005 $2,296,323.

There are approximately 4,900 houses in Mosman – so here are this week’s statistics for properties currently for sale in Mosman, Cremorne and Neutral Bay.

MOSMAN – 2088

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

CREMORNE – 2090

  • Number of houses on the market last week – 18
  • Number of houses on the market this week – 17
  • Number of apartments on the market last week – 36
  • Number of apartments on the market this week – 37

NEUTRAL BAY – 2089

  • Number of houses on the market last week – 12
  • Number of houses on the market this week – 13
  • Number of apartments on the market last week – 58
  • Number of apartments on the market this week – 66

For those subscribers who absolutely love statistics, of the 4,900 houses in Mosman,  just 118 are on the market this week. That is just 2.40 per cent!  When the Mosman house market is trading at full speed, there are around 275 houses on the market which represents 5.61 per cent. No other real estate agency in Mosman follows the Mosman market closer than Richardson & Wrench Mosman & Neutral Bay (RWM).

Without a doubt, the worst and most embarrassing property statistic that emerged this week was that the rental vacancy rate for Sydney suburbs within a 10 – kilometre radius of the CBD, fell 0.2 per cent to 0.9 per cent in April, REINSW data.  A healthy rental market should have a vacancy rate somewhere in the range of 2.5 per cent to 3.00 per cent. In my eleven years of writing Virtual Realty News this is the lowest recorded vacancy rate that Sydney has ever seen and a bloody disgrace – when rents will continue to sky rocket.

Bear in mind that one in four to retire without owning home: study yet Julia Gillard’s hopeless Fort Fumble wants to spend billions on a NBN scheme and a Carbon Tax. Throw in rising cost of living expenses and still Wayne Swan tells us that the Australian economy is tracking well?

There is also huge vacancy rate in Canberra and for politicians, it’s actually between their ears.

Alas, the Death of Salesman in 2011? If you sell, using the latest technologies, consumers will buy. If you don’t, your market will be significantly diminished.  Should the June GDP results decline again, it means nobody is buying Australia or the government for that matter. We all know nobody ever buys taxes!

Jonathan Chancellor files his final ‘Title Deeds’ tomorrow after 26 years of writing Australia’s most iconic real estate read. Jonathan still remains tight – lipped about his move which is to online publishing and all I can say is – Crikey!! Margie Blok, who is no stranger to “Title Deeds”, will be taking over letter – box patrol.

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

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3.06.11Robert Simeon4 Comments »

The holiday is over for the indulgent property markets!

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Fascinating times for property voyeurs across Australia where many once upon a time boom markets, have fast become gloom markets with property prices in free–fall.  Earlier this week, I attended the Richardson & Wrench 2011 Conference in Surfers Paradise which is today in a scary market collapse as investors bail out from a once thriving economy. Property portals in Surfers Paradise show approximately 5,000 apartments for sale although a local agent told me that the correct figure would be closer to 10,000. Gold Coast ‘dead’, says developer as projects and properties are now falling into the hands of receivers.

Prior to the Global Financial Crisis (GFC), Perth was on track to surpass Sydney as Australia’s most expensive real estate market.  How quickly things can change. WA’s property slump is now the worst in 20 years the latest government figures reveal. Activity in the housing market has fallen 15 per cent in just twelve months and more than one third since the height of the boom in 2005 – 06. North of Sydney we are seeing a low tide for prices where hundreds of thousands of dollars are being wiped off Central Coast properties. Sydney’s most indulgent holiday markets, the hallowed addresses of Palm Beach and Whale Beach, whilst they may decline in value, appear to be holding up.  Although sales are down massively, on previous years.

BUY PRINT

Just like the stock (shock) market when investors are spooked, the very same rationale applies to the property markets. Investors are bailing due to a personal over-commitment which in turn, relates to their respective outlook on the Australian economy, combined with their own financial positioning. The trend we are witnessing at the moment is investors selling investment properties, not to be confused with the family home.  Hence my suggestion, that the holiday is over!

Here are statistics I downloaded this week from our most popular real estate portal – Domain

MOSMAN – 2088

  • Number of houses currently on the market: 120
  • Number of apartments currently on the market: 101

CREMORNE – 2090

  • Number of houses currently on the market: 21
  • Number of apartments currently on the market: 35

NEUTRAL BAY – 2089

  • Number of houses currently on the market: 13
  • Number of apartments currently on the market: 60

Now that data confirms a solid market with no panic selling, we will continue to monitor this data on  weekly basis in Virtual Realty News. One thing for sure is that the investors who sell (at a loss) will try to recover significant amounts of their losses via their tax returns. I wonder if Wayne Swan factored this into his return to a budget surplus.  I doubt it. The Budget is a triumph of hope over experience where a Galaxy poll revealed just 28 per cent of voters believe it will be good for the economy. I always enjoy my weekly Alan Kohler read No surplus of ambition: Swan’s biggest plus although the polls keep telling us unpopular government, unpopular budget.

Source: The Australian- order Bill Leak’s print

Everybody (well most anyway) have a theory as to why so many indulgence markets are collapsing across Australia. I classify indulgence markets as properties purchased outside the family residence which takes us to Australia’s miracle economy: fact or fiction? For me it is quite simple. Under the Howard Government, Australia frolicked as it celebrated an unprecedented seventeen years of economic growth. Money was not the object – lifestyle was.  This is evidenced by the Australian GDP Annual Growth Rate from the early 1990’s to 2008 where today we are witnessing the clean up after Australia’s longest economic party – evidenced by this graph from Trading Economics.

Post GFC, what we are now seeing is human behaviour nearly identical to what we witnessed in the recession of the early 1990’s. This is evidenced in this graph as borrowings (leveraged debt) became an obsessive disorder. Fort Fumble did the same during the GFC which explains why it too, is having difficulty returning a once healthy budget back to surplus. Look at this graph.

I am dumbfounded as to why Julia Gillard’s Fort Fumble is spending $36 Billion (+ blow outs) on a NBN Co investment strategy so that Australian’s can have faster access to read how core markets are going broke. The decision to embark on Australia’s most expensive taxpayer investment (the NBN) was made before the GFC, yet Fort Fumble believes nothing has changed since then?

Budget, interest rate rise worries dent consumer confidence in May which is placing enormous pressure on Australian small businesses facing ‘uphill battle’ amid rents, dollar, internet competition. From an economic perspective, the demise of the ‘holiday’ property markets is driving the negativity in our property markets generally, given the real estate slump will leave banks in pain, too. This then resonates through property markets where there is no better example than – home loans drop to 10 – year low. On top of that is the reality that Reserve rate rise a question of when, not if which takes us to the inevitable as households on edge over interest rates. This roll on effect saw Moody’s downgrades ratings for big four banks to Aa2 from Aa1.

Now to the Gillard Carbon Tax debacle – electricity sector faces $6.5 billion debt refinancing “the debt challenge facing the electricity sector came as a report compiled for the federal government warned that uncertainty over the price of carbon in Australia posed a significant threat to investment in the sector. “ So we have a market capitalisation of $30 billion for the electricity sector in Australia yet $240 billion will have to be spent by 2030 and that is without a Carbon Tax.

The Deputy Prime Minister of Australia (Bobby Brown) has spoken – Greens leader Bob Brown vows to take on the media to shore up carbon tax push. Obviously an advocate of free speech, hugging trees and with a knowledge of economics that could only  be understood in a Parliamentary Economic Play School, Brownie, has decided to attack the media.

Senator Bobby Brown described newspapers’ front pages as unbalanced, opinionated and “not news in terms of having both sides.”  I believe he just described Virtual Realty News.

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

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20.05.11Robert Simeon8 Comments »

“Back in the black” Wayne, otherwise it’s the sack!

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Welcome to your Virtual Realty News tenth Federal Budget edition – although yet again we were not invited to Canberra for the lock – down (funny that). The budget announcement conveniently blames the past and paints a rosy future. An abundance of spin on the positives, yet no mention of the negatives and sadly, there are plenty. Here is my reasoning which goes back to the election and the Rudd/Gillard government’s four budgets which get worse. The Government completely ignored Australia’s slowing growth, rising dollar to dominate budget preferring to take a totally opposite view.

The biggest problem facing the Rudd/Gillard Government is that it panicked during the global financial crisis, believing that the Australian economy was terminally ill. Less than twelve months later in 2009, Australia experienced just the one quarter of negative growth. The debt had to be paid back much sooner than expected so having a budget in surplus is not something that Labor has experienced. Simply put: the Government spent too much and is now hopelessly struggling to pay back its (our) debt.  Wayne Swan can’t say which year Labor achieved its last surplus. Wayne the answer is 1989 – 90. Of course the summer of disasters hit the budget, says PM although the Government failed to list the billions lost in waste schemes such as Pink Batts and BER blow outs in the budget.  Past – Treasurer Peter Costello wrote  An economy to die for – surely Swan could manage a better budget? “The budget has no coherence, no strategy, and no conviction.”

BUY PRINT

In his 2010 Federal Budget, Wayne Swan predicted a $40.8 billion deficit where in 2011 it came in at $49.4 billion. In 362 day’s time, Swan now has to deliver a budget deficit of $26.8 billion otherwise no chance of returning to a budget surplus in 2012/13. To achieve this Swan is banking on no more natural disasters here or abroad, the Australian dollar not getting any higher, a return of strong tax receipts by individuals and companies and a stronger real estate market. Also, reign in the out of control spending on asylum seekers and of course delivering that other debacle called a Carbon Tax.

As Alan Kohler wrote Budget 2011: Australia on a wing and a prayer “In other words, it’s a wing and a prayer budget – keep spending, let the deficit blow out, and predict with a straight face that the commodities boom will bail us out eventually.” Aside from that blunt assessment interest rates will have to rise, warns Reserve Bank of Australia as confidence in economy falling as Wayne Swan claims Government can make ‘substantial savings’. Although already, we are seeing Australian’s struggling to save due to the daily increase in cost of living.

Source: The Australian- order Bill Leak’s print

Let’s have a peek at the Sydney property market to see what’s happening and why it is being echoed across Australia. Budget and rates rise flagged to pinch households although we should be thankful that Wayne Swan’s budget left Negative Gearing alone. The latest house price data from the Australian Bureau of Statistics confirms that most city markets slowed in the March quarter. Prices are falling – some suburbs still hot where Sydney house prices fell by 1.8 per cent during the quarter and the annual increase now sits at 0.8 per cent. It is most obvious that the Gillard Government simply does not understand housing affordability which is why it was completely ignored in the Federal Budget.

Forget the Gillard Government’s obsession with mining tax revenues, the largest employer in Australia remains the real estate industry. When the property markets are moving forward so is the economy so the Auction action graph clearly indicates just how much the property markets are contracting (not a bad thing for property prices). Nevertheless, a terminally ill indication for the economy given tax revenues for the State Government are collapsing.  Total value revenue was $430.9 million same time last year and $162.4 million last week.

Australia has waved goodbye to the Global Financial Crisis yet the latest data from Australian Property Monitors (APM) indicates that property prices are in decline across Australia.

SYDNEY MARCH QUARTER RESULTS

Source: Domain Property Monitors

  • House prices fell in the March quarter by -0.4 per cent after recording growth of +1.1 per cent in the December quarter.
  • Unit prices fell by -0.7 per cent over the quarter following a flat result in December.
  • Sydney median house price is now $643,713 and the median price is $448,585
  • Annual house price growth sits at +2.0 per cent and unit price growth is at +2.1 per cent, both trending downwards.

BUDGET OVERVIEW

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Wayne Swan admits China is key to returning to surplus a disgraceful summation directed at the ability of Australian business that is not mining reliant. Granted, a record $76 billion worth of spending in the booming resources sector where these decisions have absolutely no calibration with Wayne Swan policy. Wayne Swan is hedged into the Australian dollar remaining steady although Aussie dollar could hit $US1.70 by 2014, predicts money guru Savvas Savouri.

Households are being hit and when the Aussie dollar climbs they will all go to online shopping where they don’t have to pay GST on their overseas purchases.  Our retail market will then collapse Myer, DJ’s see glimmer of hope in retail sales. The Government failed to address in the Federal Budget – tax online shoppers, save jobs. Those with mortgages should be budgeting for a rate rise or two, three and four. Directors cool on carbon price and broadband which are neck and neck in the dumber and dumber policy announcements in Australia’s political history.

Finally, electricians fear set-box installation flop think Pink Batts. When it was announced that Australia was moving to digital, the Aussie dollar was at $0.68 cents.  It is now coasting near US$1.08 cents. Television prices have halved and Julia Gillard just acquired $300 million plus of useless set – top boxes that could never be sold given the Aussie dollar’s rise and rise.

Can Wayne Swan reduce the deficit to $26.8 billion by the next Federal Budget?  Of course he can (as sure as deposed Premier of NSW, Kristina Keneally, will be the next NSW Premier!!!   Work experience does not always apply to elected politicians, especially when it comes to understanding economics.

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

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13.05.11Robert Simeon7 Comments »

Mystique, mystery or misery for real estate values in 2011?

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Plenty of negative press about the property industry at the moment although we could well ask “what came first the chicken or the egg?” When consumer confidence levels are down, real estate markets have never boomed, although one market characteristic never changes, that being supply. Alas, that economic equation of demand V supply where plenty of demographic markets are experiencing an oversupply when demand is waning. To settle more than a few arguments in this week’s edition, we unveil exactly what is happening in the Mosman housing market where we identify plenty of mystique and mystery – with not that much misery. The figures don’t lie – so we went to Mosman’s most accurate market barometer Domain Property Data

Australian Bureau of Statistics (ABS) data published this week, revealed house prices fell 1.7 per cent across all capital cities except Melbourne where a 2.5 per cent drop was recorded for the March quarter 2011 – house prices dive in massive market fall. I actually love these commentaries given we are one of the few real estate businesses within Australia (with a very large voice) who can address these issues.

Steve Keen was at it again – Why Australia’s housing balloon is shot which focuses on the 1.7 per cent decline in property prices. Steve Keen predicted property prices would collapse in Australia by forty (40) per cent during the global financial crisis (GFC).  He lost that bet and he keeps (unsuccessfully) suggesting that property prices are in a bubble that will collapse. Just like me suggesting that Julia Gillard knows what she is doing as Prime Minister of Australia. Mortgage debt is the new “economic fascinator” although – RBA leaves rates on hold. The present cash rate is 4.75 per cent so there is plenty of scope to further reduce, depending on market movements.

BUY PRINT

What many forget is that in Australia, our property industry is defined by a thirty something analysis – one third rent, the second third own with a mortgage and the final third own without a mortgage. Here is the proof – it will be interesting to see how this pie graph changes after this year’s Census (I doubt by very much.)

Having been absorbed by the real estate gig for the last twenty five years I remain fascinated. Why? Purchasers go berserk during a property boom where they happily pay well above market value. Yet when the market slows and prices reduce they go into a self-induced hibernation/paralysis.  Even more intriguing is that today, online offers immediate property data anecdotal sales evidence. No better example, in How Twitter tweeted before Obama sang that Osama bin Laden had been found and executed.

So let me use the definitive sales evidence in Mosman to correctly explain what is actually happening where you work the numbers (not my words) pertaining to the mystique, mystery and whether or not there is any misery. Firstly, let’s look at the number of apartments and houses currently on the market compared to previous years.  Does this suggest that Mosman is experiencing a huge exodus of property owners?

Let’s analyse the Mosman house market March Quarter for 2010 as compared to the March Quarter for 2011- actually, we go back to 2005 to observe any patterns.

MOSMAN HOUSE SALES MARCH QUARTER 2010

  • Total Number Offered – 105
  • Private Treaty – 75
  • Public Auction – 16
  • Total Sales – 91
  • Total Value Sold – $230,950,500
  • Average Price – $2,685,470

MOSMAN HOUSE SALES MARCH QUARTER 2011

  • Total Number Offered – 83
  • Private Treaty – 40
  • Public Auction – 19
  • Total Sales – 59
  • Total Value Sold – $55,030,000 (37 sales recorded a zero sale price)
  • Average Price – $2,311,666

So to be fair let’s compare the March Quarters from 2005 to 2009.

MOSMAN HOUSE SALES MARCH QUARTER 2009

  • Total Number Offered – 64
  • Private Treaty – 48
  • Public Auction – 3
  • Total Sales – 51 (less than 2011)
  • Total Value Sold – 130,000,000
  • Average Price – $2,653,061

MOSMAN HOUSE SALES MARCH QUARTER 2008

  • Total Number Offered – 81
  • Private Treaty – 54
  • Public Auction – 7
  • Total Sales – 61 (2 more than 2011)
  • Total Value Sold – $188,720,000
  • Average Price – $3,093,770

MOSMAN HOUSE SALES MARCH QUARTER 2007

  • Total Number Offered – 108
  • Private Treaty – 78
  • Public Auction – 16
  • Total Sales – 94
  • Average Price – $2,617,332

MOSMAN HOUSE SALES MARCH QUARTER 2006

  • Total Number Offered – 99
  • Private Treaty – 69
  • Public Auction – 15
  • Total Sales – 84
  • Average Price $2,303,107

MOSMAN HOUSE SALES MARCH QUARTER 2005

  • Total Number Offered – 72
  • Private Treaty – 45
  • Public Auction – 8
  • Total Sales – 53
  • Average Price – $2,296,323

All in all, a positive story despite what is being written in the media (never let the facts get in the way of a good story). So moving on, let’s have a look at the ongoing debacle at Julia Gillard’s – Fort Fumble.

Source: The Australian- order Bill Leak’s print

Strong dollar spells political trouble for Labor as voters abandon Julia Gillard’s carbon pricing plan due to be released in July. Easily Australia’s worst ever policy announcement, which is now looks very much dead and buried. Fort Fumble can’t revoke any more new policies, given the number previously done and dusted – an Australian political record.

Budget surplus has to go and by 2012 -13 which is a political decision rather than an economic one. Still a very strong possibility that by the next federal election Australia will still be in budget deficit.

If asked to compare the strength of Julia Gillard’s longevity in Canberra to Mosman real estate prices – it’s a no brainer. Mosman house prices never looked better. Although while we have a Labor Government in power – that would represent a *BUY RECOMMENDATION*.

To all our beautiful “mums” enjoy your day this Sunday – very well deserved and forever the salt of our lives.

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

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6.05.11Robert Simeon4 Comments »

Poll position still counts for something!

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When Julia Gillard stealthily snatched the keys to Fort Fumble from Kevin Rudd in the dead of night, June 23 2010, her action was based on the party’s belief that he had “lost his way”. Ten months later the party is now shipwrecked on Point Rock at Hard Place.

In political speak, the compass is often called a poll, although Prime Minister Julia Gillard recently commented after disastrous polling, “I don’t comment on the polls, and I don’t spend much time wondering about them.” The polls were close to one hundred per cent correct long before Fort Fumble was decimated at last month’s NSW election. Polls come and go, and so do leaders as was the case in NSW where it become a simple choice of either ditch the policies or ditch the leader.  It’s now Julia Gillard versus the carbon tax, NBN Co, East Timor solution and a budget deficit that’s getting worse, not better.

Infrastructure is without a doubt the greatest problem facing modern day Australia today. NSW firms get crumbs as workers flee – almost half of NSW businesses are having difficulty finding skilled employees as they compete with the higher pay packets being offered in the mining sector.  NSW faces a skilled worker shortage given the reconstruction work in Queensland and the ever expanding mining sectors which will drive wages to dangerous levels as the shortages multiply each month and inflation will follow as inflation on a knife – edge.

BUY PRINT

I asked Tim Mooney if (by chance) he would be flying over Westminster Abbey to get an aerial shot of today’s Royal Wedding.  Unfortunately, due to budget restrictions, we settled on The Abbey in Glebe, Sydney

New home starts in 2011 are fast tracking the weakest declines since the mid 1990’s with property prices remaining subdued and many will say this is a good thing. Although on the flip side, it means that the circular flow of income (which is the oxygen for the economy) stalls, with the lack of economic growth and confidence. Home prices declined nationally in March quarter: APM we expect the same results once the June quarter figures are announced given housing credit growth remains fragile.

This week’s inflation numbers certainly point to higher interest rates by year’s end as Australia’s consumer price index rose 1.6 per cent in the March quarter (its largest quarterly jump in almost five years). The housing group is up from the 0.6 per cent level of the December quarter, with the annual rate of increase, the lowest since the September quarter of 2007. Contributing to the annual increase of 4.8 per cent for the housing group, were substantial increases in the price of utilities – 11.7 per cent for electricity, 12.8 per cent for water and sewerage and 6.2 per cent for property rates and charges. Rents increased by 4.5 per cent for the year on a weighted average, over eight capital cities and the cost of house purchase increased 2.6 per cent.

Source: The Australian, Bill Leak

Show us the money Mr Swan: it’s time to stop squandering our future by Malcolm Turnbull :Well, one thing to be said for Swan’s latest excuse is that it makes a change from the past three years of using the global financial crisis to justify failed programs and irresponsible choices.

Of course Wayne Swan nails it, when it comes to explaining the economic machinations of our economy.  Petrol jumped 8.8 per cent, vegetables increased by 16 per cent following the Queensland and Victorian floods and Cyclone Yasi and fruit increased by 14.5 per cent.  Surprise and further surprise, almost forty (40) per cent of retail spending by Australian households now lands in the cash registers of either Coles or Woolworths, according to exclusive new research by Commonwealth Bank grocery giants in 40% grab. For example: bananas cost $2.99 a kilo prior to Cyclone Yasi and jumped to $16.00 a kilo in March.

CBA’s analysis conducted for The Sunday Telegraph shows that of the $242 billion in retail sales last year, $94.3 billion or 38.9 per cent, is taken by one of the corporate giants (Coles or Woolworths) who command $46.7bn and $47.5bn respectively.

Just can’t resist another dig at the Carbon tax battle: bureaucracy v business which is an interesting debate although it should be noted that a politician will always place his/her very own job security way  ahead of endorsing a tax that threatens the length of their careers . The Carbon tax will destroy the Gillard government as the people sit in poll position and the Government is on the way to the panel beaters. Liar, liar – hair on fire!

Thousands to be stuck in NBN ‘limbo’ which is another amazing example of incompetence as thousands of Australians (many in regional areas think of the Independents) can now expect years of worse, not better, internet services as the NBN rolls out across Australia. Well it is currently stalled and facing huge cost blow–outs NBN Co housing forecasts deemed unrealistic.  Oh dear, here we go again!

To give a better understanding of the Rudd/Gillard management style of running Australia, former Finance Minister Lindsay Tanner will release his book next week titled “SIDESHOW” Ex-minister unloads on Rudd govt.

Lindsay Tanner – on the 2010 Campaign – “The worst in living memory. Banal slogans, robotic delivery, and trivial policy announcement deployed by both major parties.”

Lindsay Tanner – on Federal politics –  “Modern politics now resembles a Hollywood blockbuster: all special effects and no plot.

Last week we covered Mosman house sales and total value sold – 2000 to 2010. This week –

MOSMAN AVERAGE HOUSE PRICES FROM 2000 TO 2010

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Source: Domain Property Data

  • 2000 – Up to $5,000,000 $1,329,677. Above $5,000,000 $5,637,500
  • 2001 – Up to $5,000,000 $1,548,882. Above $5,000,000 $6,561,428
  • 2002 – Up to $5,000,000 $1,862,836. Above $5,000,000 $6,587,500
  • 2003 – Up to $5,000,000 $2,010,859. Above $5,000,000 $6,316,000
  • 2004 – Up to $5,000,000 $1,854,568. Above $5,000,000 $6,941,722
  • 2005 – Up to $5,000,000 $2,017,809. Above $5,000,000 $8,741,333
  • 2006 – Up to $5,000,000 $2,110,469. Above $5,000,000 $7,115,228
  • 2007 – Up to $5,000,000 $2,291,431. Above $5,000,000 $7,845,348
  • 2008 – Up to $5,000,000 $2,267,210. Above $5,000,000 $7,170,000
  • 2009 – Up to $5,000,000 $2,276,172. Above $5,000,000 $7,226,136
  • 2010 – Up to $5,000,000 $2,355,472. Above $5,000,000 $7,212,826

Now that is a pretty consistent score card in both market demographics, especially when we take into consideration, the global financial crisis (2008 – 2010). Interesting statistics to bear in mind when the 2011 Budget is explained, given that the global financial crisis was in the northern hemisphere!

Next week, we will release the Mosman March quarter house sales for 2010, as compared to 2011.

Anyone prepared to make a prediction?

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

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29.04.11Robert Simeon7 Comments »

When you struggle with the truth – you struggle at the polls!

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The carbon tax debacle went toxic for Labor this week when Newspoll announced its fortnightly report card – record Labor low on carbon fury. In just two weeks, Julia Gillard’s personal support has gone from its highest since becoming Prime Minister in June last year, to her worst. The Party’s credibility is now in free fall. In an astonishing revelation, Julia Gillard announced “I will continue to press to price carbon and we will get this done from 1 July, 2012”- despite anecdotal evidence that most voters believe PM broke carbon tax promise. The present carbon tax model is doomed for failure although Julia Gillard told carbon tax debate will be easy to win once the public is informed.  This is too funny for words given that due diligence thus far, is zero.

High price of short – term tactics which begs the question, will this be a short term government when it is abundantly clear that an early election is the only way out when Australia is virtually ungovernable. “Julia Gillard has learnt this week that politicians who ignore the lessons of history find themselves with historically low popularity ratings. Instead of taking a leaf out of John Howard’s script on the GST, the Prime Minister has dug a hole for Labor by trying to fast track a carbon – cum – emissions trading scheme. It is yet another sign of failure of the Gillard and Rudd governments to put long – term strategic goals ahead of short – term political tactics.”

BUY PRINT

Australia ducked the Global Financial Crisis (GFC) and it now it is faced with the Gillard Financial Crisis – Gillard is now Prime Minister in name only. Plans for a carbon tax appear to have shaken consumer confidence as carbon tax blamed for contributing to slump in consumer confidence. “Pessimists now outnumber optimists in their outlook on family finances over the next 12 months for the first time since March 2009, when Australia risked falling into recession. Westpac chief economist Bill Evans said the key factors behind the unexpectedly large fall in the index – down 2.4 per cent in March from a month earlier – seemed to be concerns over budget and tax issues, and petrol prices. While there is no specific evidence – we expect that the key negative for households … relates to the government’s commitment to price on carbon by July next year.” The Greens are killing Labor as the PM sees green and her MPs see red.

The carbon tax announcement is arguably the dumbest announcement ever made within the foundations of Australia’s political history. “Operation Abort” is already being announced – Windsor savages carbon tax strategy with the accusation of “putting the cart before the horse” because of “pressure from the Greens.” Ironic that Julia Gillard became Prime Minister with blood on her hands and months later she is haemorrhaging profusely with short – term policies that threaten the profitability of households – carbon tax is a dog ready to bite Labor.

Ziggy Switkowski wrote an interesting piece on Business Spectator Only carbon fools rush in despite industry recommending that Fort Fumble hold – off with the carbon tax until details have been formulated.  Combet: An early announcement was appropriate despite a carbon tax framework with no details to negotiate with industry. Despite business pressure for a delay, Deputy Prime Minister Wayne Swan rejects calls to delay carbon tax. This will get ugly and eventually end up with another meteoric back – flip where Caucus will take Gillard and Swan as the carcass. Keep watching the polls which will get worse for Fort Fumble especially when Kristina Keneally gets whipped at the election in two week’s time.

Property sales reach 10 – year low and the Gillard Financial Crisis is not helping matters. We note that Sydney rental market to tighten as lease is more in the new Australian dream. This does not help Australian construction contracted for the ninth consecutive month in February as the tools go down slow – down in construction activity . What we are witnessing now could be described as what the hell? Nation in regional retreat as consumers continue to tighten the belt as purses remain shut tight.

“In a grim picture revealing many families are doing it tough, about 700,000 taxpayers entered into special repayments with the Tax Office in 2009/10 – an increase of 32 per cent in four years” as Australians crippled by tax burden. The number of Australians failing to lodge a tax return has blown out to about 4 million and small businesses have racked up a crippling $9.4 billion in Tax Office debts. Households in retreat increase pressure on carbon tax with the inevitable outcome that rising bills cause consumer blues.

Every week we post on our website the weekly recorded sales activity for our demographic , so it came as little surprise when I read auction rates fudged by failed campaigns. Mosman in all probability (based on my observations) has the lowest auction clearance rate in Australia, based on results of the number of properties submitted. Yes, each week we see auction properties that are passed in and the results conveniently buried.  Some week’s/months later, when sold, they are recorded as auction sales. The last time we extrapolated the data, the auction clearance rate in Mosman was just under twenty (20) per cent. So yes, the current system is rorted. In fairness, we are really a private treaty business (maybe in 2009. we auctioned five or seven properties in total).

We intend to publish the Mosman sales results for the “above $5.000 million house market” for the past ten years, in next week’s edition.

As you will be aware, I have a bee in my bonnet over the carbon tax which every day is fast-tracking the Home Insulation Scheme. Our economy is struggling and Julia Gillard has her foot firmly on the accelerator of destruction. Alas, the Gillard Financial Crisis!

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

Cheers ^__^

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11.03.11Robert Simeon8 Comments »

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