Green “without” envy! Maybe too much fertiliser?
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Twelve months ago all we were looking for were “green shoots”. Our economic gardeners are now embarking on a crash – course of selective pruning (and I’m not talking ‘whipper snippers’). Australia appears to have bloomed too early and the economic chainsaws are sharpening their jaws. Now it is not the “buck”, rather the bulbs, that are firmly placed in the economic gardening gloves of The Emperor (Kevin Rudd) – let’s hope he has a green thumb!
Yes, the last twelve months have been a roller coaster ride that continues to gain momentum and what remains to be seen is whether as an economy, we can stay on the tracks – the alternative is not pretty if one is reliant on the cash rate remaining low. Many borrowers will find out first hand, that fortune does not always favour the brave when it comes to bricks and mortar.
The Australian Bureau of Statistics (ABS) announced this week, that consumer prices increased by one per cent during the September quarter which was a direct result of higher prices from electricity, petrol and utility prices. Fort Fumble treasurer, Wayne Swan, was quick to emphasise that the economy was continuing to operate below capacity. Capacity is this week’s economic measure of confusion – too much stimulus, too much debt, too much immigration and possibly too much spin. Each and every cash rate increase by the Reserve Bank of Australia (RBA) is a further burden to consumers and property prices have eclipsed recent records (we all know this is defined by capacity).
Is this Sydney’s coldest beach? Competitors in the World Masters Games thought so as the water was too cold – now they are demanding a refund. Photo: Tim Mooney Photography
So Wayne Swan thinks our economy is operating below capacity? Australian Property Monitors (APM) yesterday released its September House Price Series Report and here are the key statistics.
- Nationally, house prices jumped +3.7 per cent and unit prices + 3.4 per cent in September quarter
- Strongest quarterly growth in house prices since 2003
- National house prices up 7.1 per cent in 2009
- Melbourne experienced strongest house price growth, up 12.3 per cent in last six months
- House and unit prices rise in every capital city in September quarter
Wow – if this is an economy running under capacity, just imagine what happens when it grows with confidence. The Housing Industry Association (HIA) announced this week, that new home sales fell in September and nationwide sales dropped 4.5 per cent which is in direct contrast to a 11.4 per cent increase in August.
Source: Australian Property Monitors
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Source: Australian Property Monitors
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This week Taylor Fidan and I extrapolated all house, semi, apartment, and townhouse sales in Mosman from January 1, 2006 to October 19, 2009 – in total 3,054 sales. Here are our findings (houses this week and apartments next week). I wish the property data aggregators would offer this data as it is very time consuming to compile but, then again, such information has never before been presented on a public domain. We present another Richardson & Wrench Mosman & Neutral Bay (RWM) first.
Source: DomainPropertyData
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MOSMAN HOUSES/SEMIS SOLD – I JANUARY 2006 TO 31 DECEMBER 2006
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0 – $1,000,000
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$1,000,000 – $2,000,000
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$2,000,000 – $3,000,000
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$3,000,000 – $4,000,000
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$4,000,000 – $5,000,000
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$5,000,000 – $6,000,000
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$6,000,000 – $7,000,000
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$7,000,000 – $8,000,000
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$8,000,000 – $9,000,000
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$9,000,000 – $10,000,000
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Above $10,000,000
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Total
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Undisclosed
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MOSMAN HOUSES/SEMIS SOLD – 1 JANUARY 2007 TO 31 DECEMBER 2007
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0 – $1,000,000
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$1,000,000 – $2,000,000
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$2,000,000 – $3,000,000
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$3,000,000 – $4,000,000
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$4,000,000 – $5,000,000
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$5,000,000 – $6,000,000
.
$6,000,000 – $7,000,000
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$7,000,000 – $8,000,000
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$8,000,000 – $9,000,000
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$9,000,000 – $10,000,000
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Above $10,000,000
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Total
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Undisclosed
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MOSMAN HOUSES/SEMIS SOLD – 1 JANUARY 2008 TO 31 DECEMBER 2008
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0 – $1,000,000
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$1,000,000 – $2,000,000
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$2,000,000 – $3,000,000
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$3,000,000 – $4,000,000
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$4,000,000 – $5,000,000
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$5,000,000 – $6,000,000
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$6,000,000 – $7,000,000
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$7,000,000 – $8,000,000
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$8,000,000 – $9,000,000
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$9,000,000 – $10,000,000
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Above $10,000,000
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Total
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Undisclosed
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MOSMAN HOUSES/SEMIS SOLD – 1 JANUARY 2009 TO 19 OCTOBER 2009
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0 – $1,000,000
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$1,000,000 – $2,000,000
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$2,000,000 – $3,000,000
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$3,000,000 – $4,000,000
.
$4,000,000 – $5,000,000
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$5,000,000 – $6,000,000
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$6,000,000 – $7,000,000
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$7,000,000 – $8,000,000
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$8,000,000 – $9,000,000
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$9,000,000 – $10,000,000
.
Above $10,000
.
Total
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Undisclosed
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2009 is still a work in progress – however it should be noted that the volume of sales remains on the conservative side. We would be lying (not our style) to suggest that the Mosman market is also in boom with houses.
UPDATE
– last week we reported 2009 Mosman house/semi sales were at 243 sales with a value of $483,925,627. We can advise that this week, sales increased to 258 with a value of $512,781,127 (still $321,596,485 in deficit from last year’s total house/semi sales). The 73 undisclosed sales (thus far) may reveal a few secrets.
Which leads me back to capacity – where it is abundantly clear that the cost of living is on the rise and it would come as little surprise to see the inflation genie touch five per cent again.
The capacity to understand as against the capacity to compete beyond ones means is clearly evidenced by sales volume in Mosman – arguably the strongest property municipality market in Australia.
In summation – I draw your attention to this recent commentary by Alan Jones at radio 2GB.
“… a note that was sent to me which explains to me that six leading members of the Government from Mr. Rudd down, the top six have a collective work experience of 181 years, but only 13 in the private sector.
If you take out those 13 years the number that were spent as trade union lawyers that total 11, of the 181 years only two years were spent in the private sector.
So the people, who will rack up a net Federal debt of a minimum of $188 billion, the highest in our history, have virtually no experience in business.
So out of the 181 years:
- No years spent running their own business – no years spent starting their own business – no years spent as a director of a family business or company – no years as a director of a public company – no years in a senior position in a public company – no years in a senior company in a private company – no years working in corporate finance – no years in corporate or business restructuring – no years in or with a bank – no years of experience in capital markets – no years in a stock – broking firm – no years in negotiating debt facilities with banks – no years running a small business – no years at the World Bank or IMF or OECD – no years in Treasury or Finance.”
Not sure if the Opposition could improve much on these statistics either.
The Emperor promised at the last election campaign, that he would personally deliver one million computers to all year 9 to 12 students within Australia. Currently, just 150,000 computers have been delivered – must be another capacity problem with too much |Ctrl – Alt – Delete|. Maybe he should have focussed on the school band – if bulls@&% was music, you would be a brass band. Alas, I guess The Emperor is too busy taking over our health system – oops! that also appears to be on |Ctrl – Alt – Delete| too.
Cheers and best of luck at the Melbourne Cup – although the odds are stronger on another RBA rate increase. Plenty of capacity growth there – although if the RBA has rates at emergency levels, when does it then become a capacity emergency for borrowers? That would be found on the perceived green (and greener) grass of home. A home is not exactly sweet as it could be gone tomorrow for some. That too, is known in modern media as |Ctrl – Alt – Delete |.
In times of “green shoots” for new housing opportunities, does fortune favour the brave? After all, it was a first, when elected governments started teasing first home buyers with cash hand – outs.
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For this week’s recorded Mosman real estate, Cremorne real estate, Neutral Bay real estate and Cammeray real estate sales www.rwm.com.au/news/
