Posts Tagged ‘Macquarie Research’

Mamma Mia – here we go again!

How come Italians don’t like Jehovah witnesses? They don’t like any witnesses!

Well they have plenty of witnesses now with Italy at breaking point, Greece in chaos prompting another global financial meltdown as Australian stocks plunge on Italy gloom. Again Ringing The Bell best summed it up when Charlie Aitken wrote “Italian equities intraday reversed sharply, while Italian bonds also came down in yield on well sourced stories about Italian Prime Minister Berlusconi stepping down in the near future. Berlusconi’s resignation would be the single best development that could happen to risk assets globally (and the single worst thing that could happen to 18yr old Italian women), with the fear that Italian default (third highest bond market in the world) being the only fear holding back equities globally from what could be a stellar Christmas rally. The Bunga Bunga rally”.

Here in Australia, we constantly hear and read about illegal arrivals on our shores so I was gobsmacked when I read Migrants blamed amid Greek debt crisis “Imagine an Australia where one in every 12 people on the streets was an asylum seeker or undocumented migrant. Some 6,879 people landed on our shores last year, but how would Australia border protection forces cope if 128,000 appeared over the horizon. This is precisely the situation now facing Greece. With an official population of just over 11 million (half that of Australia), Greece now hosts a staggering 1 million illegal immigrants and asylum seekers.”

So it would come as little surprise that IMF warns world economy at risk when European leaders called on China, which has the world’s largest foreign exchange reserves at $US3.2 trillion ($A3.09 trillion), to invest in the fund. Time will tell if China comes to that party!

One of your best Mr Mooney – shot yesterday afternoon The Lakes GC in all its glory and it looks absolutely sensational too!

BUY PRINT

Given Asia’s pace of growth slows, says RBA’s Lowe which should not come as a great surprise (unless you are in mining) that businesses should be bracing for a slowdown. In Australia, it is most evident today how corporate strategies for a slowing economy are now a very simple fact of life.

The attention in Australia has now shifted to the Reserve Bank of Australia (RBA) as our financial lifeguard in these stormy and turbulent waters. The cash rate was dropped on November 2 to 4.50 per cent so will the RBA match the February 4, 2009 rate of 3.00 per cent?


More rate cuts needed following lacklustre mortgage lending figures: HIA given the Westpac/Melbourne Institute Index of Consumer Sentiment increased by 6.3 per cent in November from 97.2 in October to 103.4 in November. So I was interested to note one rate cut not enough to help economy, but watch employment data: Macquarie the employment data sent a succinct message Australia’s jobless rate down to 5.2 per cent in October this showed a stark contrast to employment outlook in other countries.

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Home loans continue to rise which represents the number of home loans having risen for six straight months. This should come as no great surprise given these days we appear to focus more on the negative sentiment which more often than not, clouds judgement. A classic example is strong dollar not chasing foreigners away so let’s look at the Australian Bureau of Statistics (ABS) data.

  • Sept 01 – 403,600
  • Sept 02 – 405,100
  • Sept 03 – 425,000
  • Sept 04 – 439.500
  • Sept 05 – 458,900
  • Sept 06 – 462,500
  • Sept 07 – 471,700
  • Sept 08 – 454,700
  • Sept 09 – 466,300
  • Sept 10 – 500,200
  • Sept 11 – 500,600

In September the $AUD dollar dropped to $US 0.94 and in 2001, it was $US0.48. Today, in Australia, it is more a case of the basic fundamentals of our economy remaining strong – for most obvious reasons.

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You will note that our rate cut and unemployment data point to housing recovery. This is evident with data this week revealing that for the first time in 2011, our home owners have finally come out to play. The number of houses on offer in Mosman jumped this week from 147 to 168 (the highest number recorded in 2011) and up over 100 per cent from the July 13, 2011 number of 80 houses.

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Apartments are also up significantly which would be based on the furphy that the NSW government will abolish the First Home Buyers Grant from January 1, 2012 – no legislation has been passed so it won’t happen!

MOSMAN – 2088

• Number of houses on the market last week – 147
• Number of houses on the market this week – 168
• Number of apartments on the market last week – 110
• Number of apartments on the market this week – 138

CREMORNE – 2090

• Number of houses on the market last week – 16
• Number of houses on the market this week – 21
• Number of apartments on the market last week – 35
• Number of apartments on the market this week – 44

NEUTRAL BAY – 2089

• Number of houses on the market last week – 18
• Number of houses on the market this week – 21
• Number of apartments on the market last week – 98
• Number of apartments on the market this week – 136

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

So back to Mamma Mia – the volume is turned up and to Greece and Italy the lyrics say “I’ve been cheated by you since I don’t know when. So I made up my mind, it must come to an end”.

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Look at me now – and I’m not talking about the Bunga Bunga parties either!

By the way, we also had the carbon tax passes the Senate this week so Socialism is alive and well in Australia. Just imagine the promises at the next election: no income tax payable and the national anthem will be Mamma Mia.

Cheers ^__^

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11.11.11Robert Simeon3 Comments »

A Taxing Issue That’s All Greek To Me!

Finally the EU leaders reach deal on bailout fund where the big banks will be forced to take a fifty per cent haircut on Greek Bond holdings. The Eurozone bailout fund will be leveraged to 1 trillion euros under deals thrashed out by the continent’s leaders during all night talks in Brussels. We are now nearing the end of October 2011, yet European leaders registered their concerns on the rise of sovereign debt in France, Ireland and Greece in April 2009. That’s 31 months ago!! Greece currently has a debt of 350 billion euro ($466 billion) and this deal will allow Greece to reduce its debt by 100 billion euros ($133 billion).

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One blog comment I read summed up the European crisis “The countries that have suffered do have one thing in common (Iceland, Italy, Greece, The US all have this): a desire to have first – world services and a first – world infrastructure, but without paying first – world taxes for them. Consequently, it’s been politically unviable to either raise taxes because people think they can maintain their current levels of govt service and infrastructure by cutting around the edges in welfare. Or, accept a lower grade of service/infrastructure because they’ve been told that they can have a low tax without actually cutting any serious expenditure. Hence, irreversible deficit and exploding debt. I’m not a fan of the GST, but I’ll agree that it did the job it was supposed to do – it created a large body of tax revenue that isn’t under constant political pressure to be cut, protecting Australia from the disastrous belief that you can have something for nothing and just cut taxes each election without harming the national infrastructure.”

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.BUY PRINT

The world’s greatest treasurer Wayne Swan says households still doing it tough– the man is a genius! The consumer price index (CPI) rose by 0.6 per cent in the September quarter, for an annual rate of 3.5 per cent. The average of the Reserve Bank of Australia (RBA) trimmed mean and weighted median inflation measure was a 0.3 per cent rise in the quarter for an annual rate of 2.45 per cent.

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Macquarie Economics Research offered the following commentary.

  • Headline consumer prices rose by 0.6% in Q3, but the Reserve Bank‘s preferred measure of underlying increased by just 0.3%QoQ.
  • Looking in more detail at the sectoral drivers of inflation in Q3 it is now clear that we are starting to see the sharp rise in fresh food prices after the Queensland and Victoria floods. Overall, food prices fell by 0.2% in Q33, but are still 6.4% higher than a year ago. Fruit prices are still 64% higher than a year ago. Clearly, food prices will fall much further in 4Q11 and 1Q12. Health care prices were the other broad category to record a decline in prices, but this was consistent with similar falls in Q3 in 2010 and 2009.
  • On the flipside, the much discussed surge in utilities bills certainly came through as expected. Together with the lift in local government rates and another solid rise in rents (up 1.2%QoQ and 4.6%YoY) this meant that overall housing costs increased by 1.9%. Of course, as utility bills only increase once a year, this component should record a much more modest rise in Q4.

This would explain carbon tax opposition grows: Newspoll where opposition to the tax jumped six per cent to 59 per cent and support for the tax has fallen four points, to 32 per cent.

More Sydney home owners and renters in housing stress than any other capital – Sydney has the highest number of renters as well as the highest percentage of mortgage holders at risk of falling into poverty. More than 106,000 people who rent in Sydney face difficulties meeting the basic cost of living, according to Housing Costs through the Roof a report compiled by the National Centre for Social and Economic Modelling at the University of Canberra on behalf of Australians for Affordable Housing.

Brisbane wins housing race to the bottom as the national medium home price has now fallen for five successive quarters. Grey clouds gather over housing market although the good news is that Sydney house prices to recover from next year: ANZ.

Property buyers should factor in – it’s a boom, baby, as births hit a new record Australian women have rewritten the history books by giving birth to 297,900 babies last year, a new national record, the Australian Bureau of Statistics (ABS) reports. On the flipside we have apartment construction to slump in 2012: Industry survey. Turnover generated from the construction of new apartments grew by 2% for the 2010-11 year, but forecasts to fall by 1.2% over 2011-12 before picking up by 4.8% over 2012-13. So rents will continue to climb through the roof which explains why the Gillard government refuses point blank to address housing affordability.

NSW in slow lane of new economy a study by the National Centre for Social and Economic Modelling shows that one in ten Australian households – 850,000 – spend so much on rent or mortgage payments they have little left over for other bills. A rate cut won’t rescue the market so I (yes a real estate agent) don’t believe that the RBA should cut the cash rate when they meet on Melbourne Cup day. Such a move would send a negative message that our economy is trending downwards and that would severely impact consumer confidence. We have to toughen up and not rely on artificial stimulation.

Yesterday we saw the ASX incur four hours offline, due to a computer glitch which when resolved at 2.00pm saw our markets close up two per cent higher due to the European announcement of Greece’s bailout.

    MOSMAN – 2088

    • Number of houses on the market last week – 133

    • Number of houses on the market this week – 148

    • Number of apartments on the market last week – 86

    • Number of apartments on the market this week – 103

    CREMORNE – 2090

    • Number of houses on the market last week – 15

    • Number of houses on the market this week – 18

    • Number of apartments on the market last week – 36

    • Number of apartments on the market this week – 34

    NEUTRAL BAY – 2089

    • Number of houses on the market last week – 17

    • Number of houses on the market this week – 18

    • Number of apartments on the market last week – 83

    • Number of apartments on the market this week – 92

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

Listings in Mosman peaked this week and should we see this number reduce in the run up Christmas, then market forces are engaging. If not, this will definitely happen in 2012. The next six week’s will be most revealing.

Cheers ^__^

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28.10.11Robert Simeon5 Comments »

Technology Plus Government Equals A Costly Mistake!

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The economic roller coaster was travelling at high speed this week with the “shock market” at a three year high share price surge adds $42b to market’s value. For the moment, it would appear (based on these results) that the much awaited consumer ‘ring of confidence’ is again smiling on these markets. Despite a focus on financial markets it was refreshing to note that Sydney’s still as safe as houses where data has revealed that the toughest residential market in Australia is still the best performing city over the past year. Compared to the rest of the capital cities, RP Data Rismark reported that property prices in Sydney actually increased 0.3 per cent in the year ending August.

It should be emphasised that most Australians read more into bad news which clearly overshadows those ‘good news weeks’. The 2010 General Social Survey found that 78 per cent of Australians were satisfied, 43 per cent reported being pleased or delighted with their lives, while 34 per cent gave a more moderate appraisal, saying they were ‘mostly satisfied’. Based on that assumption, we can then conclude that most Aussies are satisfied with their lives.

Alan Kohler was succinct when he wrote on Business Spectator – Flagging down a recession “Markets are falling now because the US, and probably the world, is tipping into recession once again.” Why? “That’s because a recession “isn’t just a statistical event. It’s a vicious cycle that must run its course.” Australia has caught a cold from what’s happening in the US and Europe – not pneumonia! Although we should be constantly reminded that we live in a society based on excuses.

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To be expected RBA extends rate pause although more interesting was the Statement by Glenn Stevens, Governor: Monetary Policy decision which signals Reserve puts rate cut on the menu. I doubt very much that this will happen when they next meet on Melbourne Cup day, given a clear indication that for the moment, they are keeping their powder dry. Our banks remain strong and the Australian Prudential Regulation Authority (APRA) showed that $27 billion in deposits were channelled into our banking system in August. Cash deposits swell amid global worries and the entire system saw a two per cent lift in deposits to $1.42 trillion.

One should never let the facts get in the way of a good story – too many people and not enough houses. Despite a collapse in Sydney’s housing affordability in 2010, due to a 20 per cent increase in house prices in eighteen months and seven increases in interest rates, Sydney is leading the nation’s housing recovery as demand pressures continue to intensify. A crash in property prices? Don’t bet on it so it is now time for Sydney to shed its housing funk. At this juncture, I would add that our Mosman market remains healthy, wealthy and buyers not wise as it will be going up not down. Unlike the US – when you buy a house you don’t get another one free!

We read with great sadness yesterday, about the passing of Steve Jobs: the man who changed the way we live. I’m also a tragic admirer, so it was understandable that mourners flood websites, social media with tributes to Steve Jobs. His death provoked the biggest online reaction of any in recent history with Twitter figures expected to come in at 10,000 tweets per second. To put this into context, the Japan earthquake and tsunami in March recorded 5,530 tweets per second and the British royal wedding recorded 3,966 tweets per second. I read two notable comments about Steve Jobs – the best Twitter comment “RIP Steve Jobs. You left your mark on our desks, on our ears and in our hands.” And “Jobs concerned himself with making computers work the way people expected them to rather than making people learn how the computer wanted them to work.” Which takes me to why the Gillard governments NBN roll – out will be a dismal failure.

Source: Australian Bureau of Statistics

The Australian Bureau of Statistics released the latest June 2011 internet activity revealing:

  • At the end of June 2011, there were 10.9 million internet subscribers in Australia (excluding internet connections through mobile handsets). This represents annual growth of 14.8% and an increase of 4.4% since the end of December 2010.
  • The phasing out of dial – up continued with 95% of internet connections being broadband. Australians continued to access increasingly faster download speeds, with 87% of access connections offering a download speed of 1.5 Mbps or greater.
  • Mobile wireless internet (excluding mobile handset) connections (44%) now exceed Digital Subscriber Line (DSL) connections (41%) in Australia. Mobile wireless (excluding mobile handset connections) was the fastest growing internet access technology in actual numbers, increasing from 4.2 million in December 2010 to 4.8 million in June 2011.

So Julia Gillard wants to persist with underground fibre – optic cable installations? I will be writing an article on Property Observer to be published next Monday about this taxpayer catastrophe which is fast looking like Australia’s all time greatest waste at $50 billion plus.

Mosman house vendors are ever so gradually testing the market again with the number of new properties (houses) entering the market this week, increasing by 8.5 per cent.

MOSMAN – 2088

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• Number of houses on the market last week – 106
• Number of houses on the market this week – 115
• Number of apartments on the market last week – 83
• Number of apartments on the market this week – 78

CREMORNE – 2090

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• Number of houses on the market last week – 15
• Number of houses on the market this week – 16
• Number of apartments on the market last week – 36
• Number of apartments on the market this week – 34

NEUTRAL BAY – 2089

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• 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 – 76
• Number of apartments on the market this week – 80

For this week’s sales in Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here

You can put your house on the NBN being an abysmal failure – so it is understandable that the Government will be the most surprised. Telstra’s new 4G network is boasting internet speeds 25x faster than the 3G so the NBN roll –out is fast looking like Australia’s greatest ever tax payer debacle.

Cheers ^__^

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7.10.11Robert Simeon9 Comments »

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.

BUY PRINT

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 »

Time for property markets to step up and step out!

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That proverbial property fence is about to get a whole lot lighter because this week in real estate is good news week! Thus far in 2011, the Mosman house market has erred on the side of caution with historically low property offerings, but is this about to change? Let’s analyse this week’s announcements, bearing in mind that since the global financial crisis (GFC) in 2008 our property markets have been in self–imposed hibernation.

This week, the Reserve Bank of Australia (RBA) decided to leave the cash rate at 4.75 per cent. Here is the Statement by Glenn Stevens, Governor: Monetary Policy Decision. Then the big news announcement that Australia’s gross domestic product (GDP) rose by 1.2 per cent which clearly shows that the summer floods and storms seriously impacted our two biggest export commodities – iron ore and coal. The strong National Accounts position also means that the federal government will not be able to use this as an excuse for not returning the budget deficit back to surplus. A better than expected result as the economy returns to growth in the June quarter so the September quarter should post a positive GDP result also.

Just as interesting as the GDP jumps ahead of market forecasts as consumer spending rises was a revealing survey: more cash, struggling to pay for basics, but spending more on fun. Further evidence this week – RBA graphs highlight growing savings culture where the growing trend of households is to save more and reduce debt. Despite market bets on rate cut the RBA continues to play a waiting game this cautious outlook may help contain inflation.

BUY PRINT

Australia’s unemployment rate rose in August, to 5.3 per cent (the highest level in a year) up from 5.1 per cent in July. Rising unemployment builds case for RBA to cut interest rates given the GDP results the rise in unemployment actually means that the economy is slowing. The September unemployment figures will actually show if this is trending and I suspect that unemployment will continue to rise due to the inherent problems in retail and manufacturing.

This will place the RBA under extreme pressure to lower the cash rate and it will be interesting to see if the banks, this time around, follow suit or play hard ball again? I would expect that this time, (if the following graph is any indication), they will all be singing from the same hymn book

What is interesting is that when the RBA met over cucumber sandwiches in August, there was strong argument to increase the cash rate. One month later, it has acknowledged that the global outlook is deteriorating and Australia will feel it down the track. The September quarter GDP results may tell a completely different story to that of the June quarter? Just as confusing prices fall for first time in two years where on an annual basis, inflation rose by 2.9 per cent in August, slowing from the 3.2 per cent in July.

Sydney house sales slow but steady before expected late spring uptake which is an expected, given the recent ‘shock’ market capitulations last month. We also share the opinion that the spring market set to bloom late so we expect the Mosman market to step up and step out in September, October, November and December. The telltale factor will be an easy observation – just watch the stock levels!  We expect to see a week on week growth through to Christmas. I would have to agree that the economy and housing markets are stronger than you think although households are still concerned about ‘that’ stench – Rio Tinto warns Gillard over carbon tax.

    MOSMAN – 2088

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    • Number of houses on the market last week – 107
    • Number of houses on the market this week – 115
    • Number of apartments on the market last week – 93
    • Number of apartments on the market this week – 91

    CREMORNE – 2090

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    • Number of houses on the market last week – 14
    • Number of houses on the market this week – 14
    • Number of apartments on the market last week – 31
    • Number of apartments on the market this week – 34

    NEUTRAL BAY – 2089

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    • Number of houses on the market last week – 9
    • Number of houses on the market this week – 13
    • Number of apartments on the market last week – 67
    • Number of apartments on the market this week – 79

For this week’s sales in Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here It is interesting to note from the past week’s activity that anecdotal sales evidence keeps growing as against declining.

The Australian – Bill Leak

Another diabolical week for Julia Gillard and her Fort Fumble with voter satisfaction plunging: Gillard’s support dives to new low. The obvious was stated in that only a miracle can save Julia Gillard as Labor moves on to the main game: who’s next? Stockbroker Charlie Aitken stepped up his attack on Julia Gillard by forecasting that the Australian equities market would rally by ten per cent if the Prime Minister was rolled.  I reported a few editions back, that Julia Gillard has until Christmas to turn her popularity around and I stand by that!

Cheers ^__^

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Time for property markets to step up and step out!

9.09.11Robert Simeon4 Comments »

Sydney Property Has Some Certainty, But Nothing To Build On!

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

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

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

BUY PRINT

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

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

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

MOSMAN – 2088

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

CREMORNE – 2090

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

NEUTRAL BAY – 2089

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

For this week’s sales in Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here It is interesting to note from the past week’s activity that we are starting to see activity above the $5,000,000 mark again.

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

Source: The Australian


Cheers ^__^

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2.09.11Robert Simeon5 Comments »

Property Is Now Properly Positioned!

Observers of financial markets may have been fascinated by the mayhem over the past week only to see the ASX200 rebound above the 4100 level. However, it has come at a cost. Investors have moved cash from the ‘shock’ market into bank deposits, where twenty nine banks have slashed term deposit rates since our last edition. Deposit rates fall amid global jitters where Australian Prudential Regulation Authority data showed that banks at the end of June held just under $500 billion of cash deposits which is up seven percent from a year ago. That was June, so one would well imagine that this figure is now much higher given the events of the past few weeks.

If history is any indication, this means that real estate markets can now expect a consumer rejuvenation. This is already happening in Mosman real estate (albeit in prices up to $5,000,000) where we can now say with confidence, that prices have bottomed. Yes, I have the statistics to prove it.

Despite what is happening in the US and Europe if things go bad, we have wriggle room which explains why the global turmoil led to rates pause: RBA. The movement by investors back into bank deposits is all about maintaining a tight ship the best strategy to survive market mayhem so don’t bet your house on a rate cut. The current mayhem no repeat of global crisis given Australian banks are not faced with a liquidity freeze, considering that they are now drowning in a consumer and business saving tsunami. The biggest challenge facing the Reserve Bank of Australia (RBA) is to keep consumers spending where more importantly we must be careful not to save ourselves into a recession.

BUY PRINT

The latest survey by Boston Consulting revealed that one in two Australians plan to reduce discretionary spending over the next twelve months. Aussie housing market outperforms shares, with significantly less risk where we observed no better example of this than the “shock market” last week which led investors back to the safe sanctuary of bank deposits. A natural response when investors seek to protect their nest eggs in times of uncertainty.

As a result I spent some time in our RWM Research Department this week where we extrapolated sales data for Mosman house/semi house sales from 2001 to 2011.  Our findings were fascinating.

Source: Domain Property Data

From 2001 to 2011 not once has the Mosman house/semi adjusted clearance rate for auctions broken 50 per cent.

  • 2001 – 229 auctioned, 121 sold with an adjusted clearance rate of 47%
  • 2002 – 201 auctioned, 104 sold with an adjusted clearance rate of 46%
  • 2003 – 204 auctioned, 80 sold with an adjusted clearance rate of 34%
  • 2004 – 122 auctioned, 30 sold with an adjusted clearance rate of 18%
  • 2005 – 137 auctioned, 45 sold with an adjusted clearance rate of 26%
  • 2006 – 140 auctioned, 51 sold with an adjusted clearance rate of 27%
  • 2007 – 126 auctioned, 63 sold with an adjusted clearance rate of 39%
  • 2008 – 122 auctioned, 35 sold with an adjusted clearance rate of 19%
  • 2009 – 73 auctioned, 34 sold with an adjusted clearance rate of 21%
  • 2010 – 105 auctioned, 37 sold with an adjusted clearance rate of 26%
  • 2011 – 69 auctioned, 24 sold with an adjusted clearance rate of 24%

Which brings me to why I believe that the Mosman house/semi market to $5,000,000 has bottomed and its now capital appreciation time. In 2011 Mosman has recorded 148 house/semi sales thus far – with 98 sales recorded under $5,000,000, 10 sales above $5,000,000 and another 40 sales yet to record a sale price. The highest price recorded thus far in 2011 is $15,250,000 and bear in mind that only 10 properties sold this year above $5,000,000. So let’s look at what RWM Research Department found is happening to average prices from 2001 to 2011 for houses/semis.

  • 2001 – Average price $1,724,390 with a total value sold $738,039,118
  • 2002 – Problems with the data as the average price $7,339,508?
  • 2003 – Average price $2,229,044 with a total value sold $818,059,432
  • 2004 – Average price $2,107,566 with a total value sold $655,453,257
  • 2005 – Average price $2,332,095 with a total value sold $699,628,500
  • 2006 – Average price $2,509,087 with a total value sold $1,003,635,130
  • 2007 – Average price $2,823,931 with a total value sold $1,169,107,720
  • 2008 – Average price $2,721,844 with a total value sold $724,010,612
  • 2009 – Average price $2,582,570 with a total value sold $813,509,751
  • 2010 – Average price $2,740,500 with a total value sold $920,808,149
  • 2011 – Average price $2,865,692 with a total value sold $298,032,000

More on the home front Mosmanites playing property pick a box with caution and Mosman Bridgepoint shopping centre sells to Chinese investor.

MOSMAN – 2088

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• Number of houses on the market July 13 – 88

• Number of houses on the market this week – 103

• Number of apartments on the market July 13 – 95

• Number of apartments on the market this week – 98

CREMORNE – 2090

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• Number of houses on the market July 13 – 15

• Number of houses on the market this week – 17

• Number of apartments on the market July 13 – 25

• Number of apartments on the market this week – 26

NEUTRAL BAY – 2089

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• Number of houses on the market July 13 – 6

• Number of houses on the market this week – 9

• Number of apartments on the market July 13 – 65

• Number of apartments on the market this week – 70

On July 13, Mosman recorded its lowest number of available houses when that week it recorded just 80 houses this week it broke the 100 mark for the first time since June 16 when it recorded 104 so we can expect to see available volumes for house now increase through to Christmas. Bearing in mind that Mosman has one of the lowest delinquency rates in Australia it should come as very little surprise that vendors decided that their respective front gates will remain shut until they see anecdotal evidence that property prices were well on the road to recovery. I must admit that they have played a very smart hand indeed.

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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Property Is Now Properly Positioned!

19.08.11Robert Simeon11 Comments »

No money – no honey!

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It’s that simple – Failure in Washington “Sometimes it seems that an American talent for self – congratulation is surpassed only by a talent for self – delusion.” The United States debt is now over $14 trillion and nearly two – thirds is public debt which is owed to the people, businesses and foreign governments. The US debt is the largest in the world and now has so many discussing The U.S. National Debt and how it got so big? Even before the economic crisis, the U.S. debt grew 50 per cent between 2000 – 2007, ballooning from $6 trillion to $9 trillion. The $700 billion bailout helped the debt grow to 10.5 trillion by December 2008.

Even scarier, the debt level is the debt as a per cent of the total country’s production, or Gross Domestic Product (GDP), which was $14.7 trillion in 2010. Makes one wonder what the real figure is today? The debt is 95 per cent of GDP, up from 51 per cent in 1988. Interest on the debt was $414 billion in Fiscal Year 2010 and that was with the AAA credit rating – which was downgraded last week to AA and 10 million jobs short of full employment. The U.S. has enjoyed a AAA credit rating since 1941.

Last Sunday, I was reading the Bangkok Post – Ratings Downgrade prompts attack China blasts US over debt problems “China gave the United States a dressing down over its debt problems yesterday, questioning whether the US dollar should remain the world’s reserve currency and urging the superpower to live within its means.” So we now enter Global Financial Crisis Mark ll and where will the money come from this time? Second GFC has become their debt to society with many asking – The last plan failed. So what’s the plan?

BUY PRINT

The US downgrade resulted in a market bloodbath for the Australian equity markets resulting in the worst three day slump since November 2008. Global debt crisis could last 20 years, warns Future Fund chairman David Murray “We’re a highly indebted nation overall. If you add up all government debt in Australia plus private sector debt, the aggregate is high.” He then went on to say “so in Australia at the moment we need a significant reduction in government debt, we need things that will drive private sector investment and success which generally means in the business sector lower taxes.” BHP Billiton chairman Jac Nasser strongly criticised two of the government’s key policy platforms, warning against spending $36 billion on the National Broadband Network and the aggressive timetable for a carbon tax – BHP’s Jac Nasser gives government productivity warning.

The Australian – Order Bill Leak’s Print

The U.S. financial debacle prompted Fort Fumble to issue a statement: Labor won’t budge on surplus for 2012/13 despite economists tip rocky road for surplus target. In a week full of riveting reading I enjoyed reading an article by Warwick McKibbin Ditch the delusion that stimulus saved us from the GFC a point I have been arguing in Virtual Realty News for years. Although in another back flip Wayne Swan appears to soften budget surplus pledge, calling it an “objective” which stems back to May this year when Wayne Swan can’t say which year Labor achieved its last surplus. It remains odds on, that by the next federal election in Australia, the budget will still be in deficit – the last Labor budget surplus was during the Hawke – Keating governments in 1989 – 1990.

Interesting to note this week the decision by the Commonwealth Bank and Westpac to slash interest rates is the strongest indication yet that investors are strategically abandoning equities in favour of fixed–interest securities – rate moves point to grim future. For the moment, the financial market calamities have clouded real estate confidence although we believe this will be short-lived . Everybody needs to live with a roof over their head. Will Stevens hit the panic button? It is looking that way although (at this point in time) I just can’t see a double rate cut for September, investors bet my tip is that the Reserve Bank of Australia (RBA) will keeps its powder dry.

Unlike many global banks, our banking system remains strong and I agree that CBA’s strength should be rightly seen as a plus, not a minus. Our government could not afford banking bailout, considering that it cost the U.S government $700 billion to bail its banks out in GFC Mark l. Bear in mind we now have worst retail results in 50 years which dates back to the 1961 – 62 recession. The recent equity market capitulations have seen many Mosman vendors delay their market debuts so it appears we will have to wait until late September before we see the full orchestra playing.

MOSMAN – 2088

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• Number of houses on the market July 13 – 80
• Number of houses on the market this week – 88
• Number of apartments on the market July 13 – 92
• Number of apartments on the market this week – 95

CREMORNE – 2090

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• Number of houses on the market July 13 – 16
• Number of houses on the market this week – 15
• Number of apartments on the market July 13 – 31
• Number of apartments on the market this week – 25

NEUTRAL BAY – 2089

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• Number of houses on the market July 13 – 7
• Number of houses on the market this week – 6
• Number of apartments on the market July 13 – 65
• 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

Again, no surprises with the polling: PM stalls in Newspoll doldrums as voters stay cool so it was enlightening to read that constant news cycle and rise of bloggers means quality of information at risk: PM obviously I would be surprised if that was a reference to Virtual Realty News. I’m sure if the carbon tax and National Broadband Network were canned, her polling would increase dramatically– that’s the policy with polling.

Great to be back – it will be a most eventful run into Christmas and beyond.

Cheers ^__^

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12.08.11Robert Simeon2 Comments »

Carbon Tax: truth or scare time?

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Just two more sleeps, then Julia Gillard will reveal to all, her Top Secret Carbon Tax. So intricate and delicate is this most Secretive Weapon of Mass Taxation (SWMT) announcement, it demanded complete denial during the 2010 federal election. The complexities of this SWMT are so mentally demanding, that a collaboration of the finest minds was necessary to make this decision for and on our behalf: namely, the Multi–Party Climate Change Committee. An elite membership of minds requiring just the one common denominator, i.e.  absolutely no business experience.

Fading public support spells doom for carbon tax where it would be fair to suggest that the vast majority of Australians don’t like the manner in which the tax was introduced which then opens the debate on whether the government can be trusted.  If the polls are an indication, the answer is a clear ‘no’. Liberal states band together for carbon tax showdown with Julia Gillard by questioning warnings of heavy job losses and unprecedented power price rises. Throw in an industry push to wipe out carbon price where some of Australia’s biggest industry organisations plan to spend millions of dollars (of their own money) to fight the tax. The Gillard government will go toe-to-toe with its advertising campaign and will be using taxpayer monies.

Ita Buttrose blasts Prime Minister Julia Gillard when she ripped into Julia Gillard’s leadership (or lack thereof) – unleashing a harsh critique of the PM’s time in office and challenging her to call an election. Next a political bombshell! Rangas dump fellow redhead Julia Gillard when the Red And Nearly Ginger Association (RANGA), who claim to represent the nation’s redheads, said it was withdrawing its support because she is giving gingers a bad name. The RANGA group cited disloyalty, dishonesty and incompetence as the three contributing factors.

BUY PRINT

No rivers of gold in Canberra’s Gold Creek – which today resembles Fort Fumbles budget deficit. Get those rivers of gold flowing again so bring in a carbon tax we’ll call it Gillard’s Gold – The Eureka of Taxes.

Little wonder nervous Labor MPs quiz Julia Gillard in caucus over key issues given the SWMT has their political careers on life support. As Labor support plummets in Queensland: Newspoll where even Australia’s greatest ever Treasurer Wayne Swan could be voted out – ah it’s that SWMT again. So Professor Gillard reverted back to scientific debate renewing climate change warnings with doomsday – like comparisons although we all know that Australia’s SWMT reductions will play next to no role in global reductions. Alas! Constituents battle this mentally taxing issue: albeit without consultation and participation.

What a wonderful democratic society we now find ourselves in where the kryptonite for constituents to rely on is otherwise known as polls – Julia Gillard’s Fort Fumble has rapidly morphed itself into Kristina Keneally’s Fort Crumble Mk II. Can the carbon tax refloat the beached ALP ship? Graham Richardson has made up his mind. Labor is shot to bits and there is no way back for Julia Gillard or the party she leads. Put down the glasses and wait for 2013 to deliver the first Abbott administration.

The Australian – Order Bill Leak’s Print

Carbon scheme to hit state dividends the chief of NSW state-owned power provider Macquarie Generation, Russel Skelton said he expected additional costs of up to $700 million per year, which would lead to the elimination of all dividends his company would have paid to the state, The Australian reports. Just what NSW needs when Treasurer Mike Baird warns of NSW budget cuts with the state’s finances “utterly out of control” given the inherited $5.2 billion black hole, care of the previous Keneally government. NSW is broke, with the budget in complete disarray to the extent that the state is not funding its operating costs from current revenue models.

Reserve Bank of Australia holds interest rates as growth stalls given the RBA’s forecast of 4.25 per cent economic expansion in 2011 – 12 can’t be met (Treasury predicted 4.00 per cent). If you are in the mining industry you are doing brilliantly. For those not in mining, the future is looking bleak. The good news is that interest rates will not be rising this year given the RBA revised down growth predictions from 4.25 per cent to 2.5 per cent which sends a very strong indication that the Australian economy is going backwards. Unless of course you are in mining!

The Mosman, Cremorne and Neutral Bay property markets appear to be enjoying the annual winter hibernation given the unprecedented low levels of available properties. I’ve been writing Virtual Realty News for eleven years and can’t ever remember such low stock levels especially in house volumes.  No panic selling – more a sign of battening down the hatches.

MOSMAN – 2088

  • Number of houses on the market last week – 87
  • Number of houses on the market this week – 83
  • Number of apartments on the market last week – 97
  • Number of apartments on the market this week – 99

CREMORNE – 2090

  • Number of houses on the market last week – 15
  • Number of houses on the market this week –  16
  • Number of apartments on the market last week – 33
  • Number of apartments on the market this week – 34

NEUTRAL BAY – 2089

  • Number of houses on the market last week – 9
  • Number of houses on the market this week – 7
  • Number of apartments on the market last week – 67
  • Number of apartments on the market this week – 62

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

By sheer definition, a tax means that either directly, or indirectly, somebody must pay. Recently I wrote Nothing new about for NSW for Property Observer a carbon tax is the last thing the NSW Liberal government needs, considering that the previous NSW Labor government has all but bankrupted the state.

The prime minister keeps telling us that Australia is in a very strong economic position – obviously economics is not her strong point. Next Tuesday, the latest Newspoll will be released and her popularity will, in all probability, remain in freefall.

The O’Farrell NSW government is concentrating on infrastructure. It would appease Australians if the Gillard government followed suit. Construction shrinks for 13th month the Australian Industry Group/ Housing Industry Association performance of construction index fell by 3.8 points to 35.8 in June. The benchmark is 50 – anything above represents expansion and below, identifies contraction.

“Building a better Australia” – Ms Julia Gillard.

It’s not just the carbon tax causing truth or scare for  Australians!

Cheers ^__^

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8.07.11Robert Simeon6 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 »

Wanted: A government that can read an economy!

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

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

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

BUY PRINT

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

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

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

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

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

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

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

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

MOSMAN – 2088

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

CREMORNE – 2090

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

NEUTRAL BAY – 2089

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

For this week’s sales in Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here

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

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

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

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

I will note your advice on our blog.

Cheers  ^__^

 

 

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10.06.11Robert Simeon10 Comments »

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