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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.

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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Aussie dollar has appreciated 21.82 per cent during the last twelve months which explains why the expats have all but withdrawn from our real estate markets.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 »

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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 »

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In life when individuals face that much dreaded financial crisis it’s the  outgoings that need to be harnessed so it comes as little surprise that Fort Fumble is facing a funding dilemma. There are very big cracks appearing (both internal and external) for a Government in serious difficulty to make ends meet as Julia Gillard warns of tough budget. A tough budget can have serious ramifications with consumer confidence.  This  then resonates through business by stymieing economic growth and strangling productivity.  Executives expect sales to fall on rising fuel, wages – study.

Allow me to apply the KISS Theory – (Keep It Simple Stupid.)

Facing a budget deficit of $41.5 billion in 2010/11 the Gillard Government now needs to borrow in excess of $110 million every day to meet its debt commitments. Despite forming Government in 2007, and then being dropped into a global financial crisis or (northern hemisphere financial crisis as many now call it). Fort Fumble would love nothing more than to get its hands on that $20 billion surplus and zero net debt, inherited when it  came to Government.

The Wayne Swan economic theory – “Shout the Bar” recovery is now considered a dismal failure.

Company tax slump puts hole in budget where Treasury minutes identify that 2010/2011 tax revenues will reach only $60.6 billion which is 10 per cent down on last year’s revenue forecast of $66.5 billion. Before last year’s election Treasury was projecting company tax revenue of $80 billion – which equates to a $20 billion or a 33 per cent bum steer. The 2010 Budget also factored in an exchange rate of US90c which is approximately 15 per cent lower than today’s rate. Economists are now projecting that the Aussie dollar will be at US1.10 by year’s end. Bugger – Wayne Swan has no Plan B given natural disasters forecast to cost economy $9 billion.

Saving Swan from himself thanks to our commodity price boom the budget bottom line would be woeful. As Malcolm Turnbull pointed out in a speech in Melbourne yesterday. “Treasury now calculates that the resources boom generated revenue windfalls of approximately $65 billion during Labor’s first three years. Of course every cent and more was spent.” He added that Treasury projects that a further $30 billion is set to flow into government coffers in 2011 – 12 as a result of the boom. But, he added, ‘when Wayne Swan delivers the 2011 – 12 Budget on May 10, you can safely bet every cent of that will be spent too.” When one clearly looks at the entire economy it becomes blatantly obvious that mining hides flatlining economy. Which takes us to the next level of discussions Turnbull first and clearest on the need for a sovereign wealth fund.

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Without jumping to obvious conclusions, Fort Fumble’s directive for an immediate tools down order is estimated to be worth more than $12 billion – a signal that this project is now headed backwards. High prices force NBN to suspend cabling tender process and look elsewhere and as day follows night NBN head of construction Flannigan quits. So far Fort Fumble has spent $1.400 billion and to date, only 500 Tasmanian households have been connected.  This equates to a cost (per household) of $2.800 million for each connection and it will only get worse as fears National Broadband Network bill could top $44bn.

Freedom of Information revealed PM’s carbon tax to cost households $16.60 a week, Treasury figures show then an unintelligent  rebuttal  by Climate Change Minister Greg Combet who dismissed the finding, saying “they are not modelling that would reflect the Governments current approach.” Of course Mr Combet is banking on the fact that much like company tax projections, his Treasury has a 33 per cent over projection?  The only problem with the rejection is that the Government can’t correct the Treasury figure because (it appears) that it is yet to cost a carbon price. Or, if such a carbon price does exist, why does it remain a secret as detail of carbon compensation up in the air.

Source: The Australian – I was wrong to ditch emissions trading: Rudd

Reserve Bank holds back on interest rate rise given underlying inflation which has slowed to its lowest level in a decade, despite soaring petrol and food prices. You can also throw in residential rent increases which increased nationally by 1.4 per cent and by 2.7 per cent in the capital cities according to the RP Data March 2011 Quarterly Rent Review. The average rent for an apartment in Sydney is now $430.00 per week and that does not include utilities and an extra $16.60 per week for a  carbon tax. If Fort Fumble was not in such a dire financial position, would a carbon tax have been considered? Is it to reduce emissions or reduce Government debt?

No home price growth over the next year: NAB which is not a bad thing as economic markets reconfigure and stabilise. I don’t support the Australian housing bubble argument and those comparisons to what happened in America. Firstly, our banks are up there with the best performing on a global scale. Secondly, in Australia (unlike America) you can’t send the keys back when the going gets tough without facing the financial consequences. Thirdly, Australia has a rapidly growing population and a severe under-supply of housing.  Australia’s affluent suburbs have been driving up the national average although the measure relates to average income. Those with an average income do not purchase in the affluent suburbs.  Those with above average incomes do. The Australian property bubble will only burst if the ‘above average’ earners find themselves in dire financial circumstances that necessitate an immediate property market withdrawal – which won’t be happening anytime soon.

Australia today is just one of a handful of countries remaining, where the sale of the family home is tax free . Nor is it tax deductible as is the case in the vast majority of countries.  Maybe the Australian housing formula is what other countries should be adopting,  to ensure that their property markets remain stronger during a financial crisis? It is very hard to argue with the property facts – and facts are obviously missing with the carbon tax debate.   This  is why support for Labor and Julia Gillard plunges again as carbon tax takes its toll and this week’s sin – binning of the NBN Co will only make matters worse. For Labor it’s Julia or bust given the party she leads is starting to make the Estate of the Late Fort Crumble look like the perfect political party.

What you didn’t read in The Sydney Morning Herald this week was Jonathan Chancellor quits SMH to set up rival site. Sadly, we can reveal that he won’t be joining us here on Virtual Realty News as he doesn’t want a tax problem. After Virtual Realty News Jonathan’s Title Deeds column is the most popular weekly read in real estate!!!

Crikey! After 25 years, this real estate legend has well and truly stood the test of time. Another newspaper journalist moving from broadsheet to online.  Who would ever have  thought?

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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8.04.11Robert Simeon9 Comments »

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Ask any business owner what the key to business longevity is and nine times out of ten the answer will always be – customer service. It all started just before the running of the 150^th Melbourne Cup when the Reserve Bank of Australia (RBA) announced its Statement by Glenn Stevens, Governor: Monetary Policy decision.  The punters were shocked with this rate rise shock – the fourth increase in 2010. The cash rate increase was later to be described as the RBA makes pre-emptive strike, economists say. Then as quick as Americain down the Flemington track the Commonwealth Bank adds 45bp to home loan rate effective from today, citing “overall wholesale funding costs continue to increase as cheaper funding expires and is replaced with more expensive funding”. The banking stewards (otherwise known as politicians) were quick to saddle – up although opposition Treasurer Joe Hockey was already in a somewhat awkward and lonely canter.

A graph that has figured prominently in Virtual Realty News is the Household Estimates of 2007 – 08 which is the last Australian Bureau of Statistics (ABS) measure of Australian households that rent, own with a mortgage and own without a mortgage – which I call The Big Third Theory.

• The number that rent – 2,399,900 which equates to thirty (30) per cent.
• The number that own with a mortgage – 2,835,200 which equates to thirty six (36) per cent.
• The number that own without a mortgage – 2,679,200 which equates to thirty four (34) per cent.

Based on this anecdotal data where with each and every cash rate increase the impact affects sixty six (66) per cent or 5,079,100 Australian households. Politicians need to cease being statues.

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Another Tim Mooney brilliant capture that would make a great front cover for Eastern Suburbs real estate agents’ Christmas cards – nothing beats a sensational aerial shot.

Credit card debt more common than mortgage debt and we all know that the Big Gang Theory of increased funding does not apply when they are already charging consumers around twenty (20) per cent. When the Melbourne Institute revealed their June quarter 2010 results they announced that for the first time since November 2006, credit card debt is the most common form of debt among Australian households, rather than mortgage debt. The number of households with credit card debt was 36.6 per cent, while 33.9 per cent had mortgage debt. Credit card rates should be at the very same rate as home mortgage rates.

Customer service is all about meaning business not being a mean business – The Big Gang Theory.

Joe Hockey has good idea, no – one takes notice given banks showing no rates restraint, despite massive profits so out came Joe Hockey’s Nine – Point Plan when he addressed the AIG Annual National Forum in Canberra on October 25 in Canberra – “It’s time to talk banking.” Banks, rates and regulations: who’s in charge here? As Westpac chief Gail Kelly calls for calm as anger builds over bank rate rises given the banks are wary of Hockey bandwagon. The irony being that just only last week it was Hockey who was copping the bashing when he suggested that he’d re – regulate interest rates. As Dennis Shanahan wrote in The Australian – It’s Hockey’s turn to bash Swan. “In just a few moments yesterday, Joe Hockey and the Coalition went from being buffoons to heroes. And Wayne Swan went from being economically and politically superior to being populist, ineffective and trailing the opposition Treasury spokesman on banking policy.” Out from the gates then jumped Wayne Swan flags banking reforms declaring the federal government would now announce banking reforms next month prompting Hockey “The Jockey” to demand release reform plan now – the “Big Fella” was now on a roll dining out on roasted swan.

There was still plenty happening within Fort Fumble’s home economics kitchen when Phillip Coorey from the Sydney Morning Herald revealed – Out in the cold: Rudd held fake budget meetings to stop leaks not to be confused with steamed leeks. “Kevin Rudd and his senior ministers were so suspicious of Lindsay Tanner that they used to hold fake pre – budget meetings to ensure their plans did not leak. According to accounts of meetings of the now abandoned Strategic Priorities and Budget Committee, nicknamed the gang of four, some meetings with Mr Tanner would deliberately be light on detail. After the meeting concluded and the then finance minister had left, the other three members of the committee – Mr Rudd, Julia Gillard and Wayne Swan – would reconvene and discuss their budget plans in detail.”

Lindsay Tanner is writing a book and I can’t wait to read that given the revelations say very little for Kevin Rudd’s schoolyard games amid financial crisis. I can’t ever remember reading a more damaging report about an elected Australian government’s economic credibility. I must admit that I have always been a Lindsay Tanner admirer – he was smart, to the point and definitely not a populist policy proponent.  Kevin Rudd denies holding fake budget meetings … why am I not the least surprised.

In the meantime, Australia is bathing in a budget surplus (not) as Labor racks up $25.2 billion deficit in just three months shadow minister for finance and debt reduction Andrew Robb reported. The latest government financial statement reveals a staggering budget deficit of $25.2 billion for the first three months of the financial year. “The government is banking on improvements in revenue to bring the budget back to surplus, yet this statement shows no signs of the level of improvement that will be required and therefore spending must be cut.” CommSec chief economist Craig James estimates that the underlying budget deficit in the year to September was a record $63.3 billion. “The main concern is that revenues are still tending sideways rather than showing signs of repair. Meanwhile, government spending is at record highs and showing no signs of stabilising.”

Without a doubt one of the smartest economic reports that I have read is Economic reform will curb pressure on rates which lays much of the blame for increased interest rates on inept government policies. “But while rate rises are a blunt instrument, they are just about the only way the RBA can suppress demand. With a rising dollar, which will depress exports other than minerals and energy production, it is an automatic stabiliser that will slow the economy. A far better solution would be for government to have invested in infrastructure – railways and ports – to increase the efficiency of exports and to have improved productivity in southeast Australia, which is not benefiting directly from the boom. But the Howard government spent the taxes raised by energy exports on its watch on welfare payments and Kevin Rudd threw money at unproductive job programs, as Julia Gillard is still doing.”

“In the current circumstances, the price of stalling economic reform will be more painful than interest rate rises”. Hence, building approvals slide more than expected in September with a 6.6 per cent fall – in the year to September building approvals were down 11.6 per cent.

So figures confirm building weak which is understandable given the Gillard government still has more than $6 billion to be spent with her Building Education Revolution. Don’t blame the Big Gang Theory entirely as we all know they suffer on compassionate grounds. The answer should not be directed to angry customers should switch banks: Gillard rather economic reform, and we all know what happened to the Henry Tax Review.

No wonder Australians want an election – now given both forms of government continue to ignore economic reform. It is becoming increasingly obvious that economics is not a strong point for either party of choice – hence the ongoing and growing budget deficit.

When it comes to Nation Building – Fort Fumble (Gillard) has lost the plot!

Subscriber sales jumped to $986,510,220 so we are closing in on the magic $1 billion in subscriber sales.

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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5.11.10Robert Simeon6 Comments »

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Another fascinating week following the recent federal election. Our new politics takes on a toxic taste, the newly elected Fort Fumble is under attack and there will be plenty of casualties. Whilst treason within Fort Fumble can never be ruled out – Paul Kelly in The Australian wrote “Welcome to the new politics once inconceivable yet now on stunning display: the discredited Kristina Keneally NSW government, the ACTU and the Greens in a united troika against the Labor government of Julia Gillard.” Whatever the outcome, this will get ugly, especially when one throws in the broadband battle: PM appeals to opposition as bills reintroduced.

Wayne Swan ‘no’ to release of mining tax figures which defies a Senate order as the deal with big miners unravelling. Was there ever a deal? These are but a few issues which will impact seriously on the Australian economy. Such as mining tax ‘unravelling budget surplus’ – Abbott although it is fast resembling a mining and banking war as Labor’s besieged on two fronts.

Will Keneally burn Gillard? I don’t think so you broke our deal, Gillard tells Keneally so this hissy fit then became the “Battle of the Birds” – (finger salutes included.) Paul Kelly wrote “there are many morals from these events; the clearest is that the NSW government is radioactive in a political sense and will contaminate anything it touches.”

In The Australian Niki Savva wrote this brilliant piece Lead on reform or lose way – “Julia Gillard has failed to take charge and shape the national debate on key issues. More than 100 days in both jobs, Julia Gillard has failed to properly define herself as Prime Minister or as Labor leader.” Then to Premier Bambi (I will have to borrow that) – “If a state Premier as damaged and weakened as NSW’s Kristina Keneally feels emboldened enough to challenge Gillard on an issue involving unions, and one central to Gillard’s claim of success as a reformer, negotiator and administrator, then the Prime Minister is in real trouble.” Don’t forget the farmers are up in arms given their “rivers no longer run free.”

BUY PRINT

Building industry faces skills shortfall as the booming mining industry is now moving our skilled workers away from building infrastructure as construction industry braced for upturn. The Australian Industry Group (Ai Group)/Australian Construction Association (ACA) construction outlook survey expects the value of construction work to rise by 5.9 per cent during 2010/11 and then 7.9 per cent in 2011/12. This follows just 1.5 per cent in 2009/12 which is led by iron ore and coal; commodity export prices have soared by 52 per cent in the past year to surpass the pre–global financial crisis. Australia’s jobless rate creates wage pressures, report says given skilled workers are headed off to make their fortunes, thanks to our mining boom.

Fast but not free is key to future crisis approach where there are similarities with the failed Fort Fumble home insulation bungle. “The coordinator general and the kitchen cabinet that made all decisions about stimulus spending got the speed they wanted: actually they got a kind of modern – day gold fever: 200 insulation installing firms mushroomed to 10,834 in less than a year and the budget for the program blew out by $400 million.” Australia appears to be digging plenty of mines without any foundations given house building activity hits 18 – month low. Australia has a labour market of just 12 million people – the mining industry is eating up the construction industry. Julia Gillard needs to immediately remove the GST from the residential construction industry and get licensed builders back building houses. Recently it was revealed that Australia has a shortage of approximately 200,000 houses and this will grow to 800,000 by 2020 which identifies glaring problems within the Australian building industry.

Much written, read and said about the condition of Australia’s housing markets, so we found this RP Data graph an interesting insight into the state of play. Here are the Top 5 suburbs around Australia for the year to July 2010. No need to guess which suburb leads NSW for total value of sales.

Mosman dropped to third in the apartment stakes although what is interesting, are the results for Manly and Dee Why. With just eight weeks left in the official selling season for 2010, a Melbourne Cup cash rate increase will certainly test many niche property markets (which we preview next week). Compelling viewing given Mosman stock levels for both apartments and houses are on the rise as the graph below shows.

Always something to write about in our industry although I could not believe my eyes when I read Minister moves to mandate NBN so even if you don’t want Fort Fumble’s national broadband network you will be charged (reportedly $300) to be connected to it. Of course, this will probably blow out to $500 plus by the time the trenches are dug.

Cheers ^__^

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22.10.10Robert Simeon6 Comments »

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The global financial crisis (GFC) has been a fascinating turn of events where businesses and households tweaked, sleeked and critiqued their respective currency flows in a battle for survival. So now we hear that as the good times roll, expect the cost of living to rise exponentially. With interest, I was reading another blog on Business2 which intrigued me.

“While you are talking to Glenn Stevens ask him how come the inflation rate is around 3% when everything we use or consume is rising at a much faster rate than that, and also – how come home mortgage rates in the rest of the world are SO much lower than here. And how come the banks are crying about the cost of funds – and making multi BILLION profits. And why won’t we let some other banks into this country to compete with the Big 4. Also – how come the homeowners of this country have to carry the burden of government stuff ups via monetary policy every time?”  Poignant questions to those residents living on Recovery Road, Australia!

Sydney real estate markets this year have been in a somewhat chill mode, although recent sales results are sending strong indications that the tide is turning and sentiment is starting to heat up. This week’s Mosman real estate sales are the strongest recorded this year as the results show here. Source: Domain Property Data

BUY PRINT

I was consumed by this week’s announcements to the residents on Recovery Road, Australia – starting with The GFC saved Australia. “As an aside, the realities of what really happened at our Big Four banks over the past three years makes CEOs’ extreme pay packets all the more obscene. Remember that the CBA’s $16 million man this year, Ralph Norris, took the top job in 2005 – his latest bonus bonanza supposedly recognises his responsibility for the bank coming out of the GFC in such rude good health. Haven’t seen much impact of his presumed matching responsibility for the bank’s financial and reputational exposure to Storm Financial, ABC Learning, Babcock & Brown et all reaching their crescendo on his watch. Similar remuneration report follies are on the way from ANZ, NAB and Westpac.”

Plain old economic growth is good for society as inflation expectations of 3.1 per cent in September quarter – survey as the RBA beats the inflation war drums. The mining boom will push interest rates up, Reserve Bank’s Glenn Stevens says as the odds shorten for October rate rise. Let the speculation begin when former RBA economist tips 5.75 per cent cash rate which in real terms equates to a 125 basis point increase over the next fifteen months. This would place Australia’s first ever female prime minister at Fort Fumble under increasing pressure, given 2011 could very well be another election year? Which bank? CBA joins calls for an October rate rise despite the release of data this week that household savings fall signals money woes as home loan customers told to brace for $90 – a – month increase in repayments. On top of this the Reserve Bank of Australia revealed this week that the big banks increase penalty charges take 9 per cent to $536 million after more customers fell behind in payments.

Electricity charges have gone through the roof as power bills force big firms to flee from NSW as Fort Crumble continues to mismanage NSW’s power supply where price rises put power to 138,000 people in jeopardy. Opposition energy spokesman Duncan Gay said he would not be surprised if big businesses fled NSW after being forced to bankroll an overdue energy infrastructure upgrade. “NSW Labor has ripped $14 billion out of the state’s energy retailers in dividends and taxes and failed to re-invest in our ageing infrastructure.”

Fort Crumble is encouraging Sydneysiders urged to shift inland as they drown mentally in addressing infrastructure collapses in NSW. The problem with Fort Crumble is that with just six months in power, it doesn’t have a single plan – as public loses all faith with planning process. For example:

Taking the low road to disaster where Fort Crumble has delayed 60 major road projects by at least five years (some longer) because  it can no longer fund urgent road works. No wonder Fort Crumble, hopelessly and embarrassingly broke, is trying to push residents into the bush. There is no greater example of how the present state governments mismanage debt than as state’s debt binge to top $240 billion as private sector faces squeeze. Analysis by The Australian of state (fake) budget round has found that borrowing is forecast to soar 52 per cent from $159.6 billion this year to $243.2 billion in 2014 to help fund upgrades to rundown transport, electricity and water infrastructure. The analysis found NSW and Queensland had the highest level of borrowings and both face re-election within the next six months. Constituents are wondering whether we have state governments or fake governments?

Yes, the road to recovery is long, winding and bloody confusing where even the strings on our elected puppets have worn thin and in NSW, the show can no longer go on. No wonder there is increasing demand for property within five kilometres of the Sydney CBD.

Alas, Fort Fumble embarks on a $45 billion NBN network which will become Australia’s greatest ever white elephant. We need a Very Fast Train to link cities because road works in NSW have virtually ceased.  For the record, wireless (not cable) works very well even on very fast trains.

In answer to the earlier question, “how come homeowners of this country have to carry the burden of government stuff ups via monetary policy every time?”  What Australia needs, is a train of thought – not a broken cable car!

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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24.09.10Robert Simeon3 Comments »

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The circuses at Forts Fumble and Crumble are folding their tents because, with below par performances, the crowds are disgruntled.  Angry voters ready to give Rudd the red card an amazing turnaround where this fairy–floss policy is being eaten away and RSPT now means ‘Return Sender Priority Termination’.  Having said that, under the big tent in Canberra, The Emperor (Kevin Rudd) is the  star performer of his pet event – the back flip, which he performs with ease.  It would be much easier to call an election and put the RSPT to a referendum.

Can the tax be fixed when Rudd says it’s not broken? The Emperor appears to be a broken man bearing no resemblance to Broken Hill. Kevin Rudd fights dissent in ALP ranks yet the Ring Master PM Kevin Rudd holds line on mining tax reform. The trampoline at Fort Fumble is losing its bounce, as Peter van Onselen declared this week in The Australian novices at the wheel of state. It was revealed that two thirty year olds and a thirty one year old, with no experience in the labour movement and next to none in industry or business, are coaching The Emperor with his back – flips. “However, now that Rudd appears out of his depth, caught up in poorly constructed defences of policy positions and back downs over challenges he had previously described as too important to walk away from (think emissions trading), the trio is being blamed for bad advice that could culminate in Rudd becoming the first Prime Minister in nearly 80 years to lose office after one term.”

The show must go on…..

Bugger – I thought I had Tim with this week’s request. Thinking North Pole next week!

BUY PRINT

Having read the Minutes of the Monetary Policy Meeting of the Reserve Bank Board and feeling somewhat comfortable that one institution has its act together, out came Australian housing market ‘a time bomb’.

Humming “send in the clowns” and in they came. “The Australian and British housing markets are the last two bubbles left in the wake of the financial crisis, and it is only a matter of time before they crash, warns legendary US investor and co – founder of global investment firm GMO, Jeremy Grantham. Mr Grantham famously reported a year before the global financial crisis: “In five years, I expect that at least one major bank (broadly defined will have failed and that up to half the hedge funds and a substantial percentage of the private equity firms in existence today will have simply ceased to exist”. The Australian reported yesterday that he said “ Australia had an unmistakable housing bubble and that prices would need to come down by 42 per cent to return to the long – term trend”.  “You cannot possibly miss it,” he said.

Reserve Bank waters down fears of real estate housing bubble and consumer sentiment is holding up. The Real Estate Institute of Australia weighed in No housing bubble in Australia citing over the period December 1996 – December 2009, median house prices increased from around $160k to around $500k; a trebling in thirteen years. Within this period there were four phases:

• From December 1996 to September 2000, median house prices in Australia showed a moderate average growth of 2.1 per cent per quarter.
• From December 2000 to December 2003, house prices appreciated at a greater rate of 3.9 per cent per quarter on average.
• From March 2004 to December 2008, house price growth moderated to an average growth of 0.8 per cent per quarter.
• During 2009, growth of median house prices again accelerated to 2.9 per cent per quarter.

Time to take a Mosman tent snapshot to see where we are today, compared to this time last year. The messages are mixed as the results show. We collated the data from Domainpropertydata and it should be noted, that a significant number of sales in 2010 are yet to record a sale price because of confidentiality agreements. It will take a few more months before we have an exact position, so these figures will be higher, rather than lower.

Mosman house and semi sales 1 January 2009 – 15 June 2009

• Total number offered – 148 @ $329,394,627
• Total number sold – 132 @ $305,159,627
• Private Treaty – 120 @ $280,714,627
• Auction – 12 @ $24,445,000
• Total Combined Median – $1,815,500
• Total Combined Average – $2,347,381
• Highest Price – $13,200,000
• Lowest Price – $975,000

Mosman house and semi sales 1 January 2010 – 15 June 2010

• Total number offered – 171 @ $276,487,629 (2009 – $329,394,627)
• Total number sold – 147 @ $276,487,629 (2009 – $305,159,627)
• Private Treaty – 91 @ $206,089,629 (2009 – $280,714,627)
• Auction – 56 @ $70,398,000 (2009 – $24,445,000)
• Total Combined Median $2,105,000 (2009 – $1,815,500)
• Total Combined Average $2,425,330 (2009 – $2,347,381)
• Highest Price – $11,000,000 (2009 – $13,200,000)

The Auction Comparisons

• 2009 Number Auctioned – 34 (2010 – 87)
• 2009 Number Withdrawn – 27 (2010 – 10)
• 2009 Number Sold – 12 (2010 – 56)
• 2009 Clearance Rate – 35 % (2010 – 64 %)
• 2009 Adjusted Clearance Rate – 20 % (2010 – 58 %)

The challenge ahead for real estate in 2010

This is not confined to the Mosman market. All real estate markets will face the challenge of matching and/or bettering the sales results recorded in the 1 July 2009 – 31 December 2009 market where results were significantly higher, compared to the previous six months.

Mosman house and semi sales 1 July 2009 – 31 December 2009

• Total number offered – 192 @ $418,706,750
• Total number sold – 174 @ $408,296,750
• Private Treaty – 127 @ $340,354,750
• Auction – 47 @ $67,942,000
• Total Combined Median – $2,250,000
• Total Combined Average – $2,617,286
• Highest Price – $12,000,000
• Lowest Price – $836,000

There is no way to avoid  the fact that our property markets have slowed since April economic recovery seen losing steam.  Events in Europe and of course the ongoing hangover of the RSPT debacle have  also been major contributors. So back to those green shoots we go – home building the biggest in nearly six years and investors ignore signs and pile into property.

Figures from the Australian Bureau of Statistics show that while home loans to owner/occupiers fell a seasonally adjusted ten per cent in the first four months of the year, lending to property investors rose eleven per cent. In the past year, lending to investors rose thirty per cent nationwide, and twenty per cent in NSW.

Our property markets (historically) tend to hibernate over winter so I wouldn’t read too much into present activity. It’s actually a good time to buy!  It does appear however, that the “fat lady” won’t be singing for some time to come, which shows just how hard it is to read property markets. Unlike the share markets, we don’t have buy and sell recommendations.  Investors are selling out of the stock market and moving their funds into the property markets – another clue?

Word from Sideshow Alley this week is that The Emperor is considering performing until April 2011 where he will call an election. Looks like his advisers consider it would be smart to go to the polls immediately following the Fort Crumble election in March 2011. I wonder if this weekends by – election in Penrith may change that decision?

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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18.06.10Robert Simeon2 Comments »

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Political correctness is out the window too. With more back flips than a Russian gymnast, degrees of difficulty can escalate in an election year (if off balance) and coupled with poor execution, can result in a lack of balance. It’s all very well to talk-up the routine before the execution, but we all know that Fort Fumble (Federal Government) resembles a modern day pin ball machine that constantly hits  tilt and freezes as a result of overzealous activities. In a nutshell:  You pour money in, only to see the machine (otherwise known as an economy) correct your aggressive behaviour!

The Emperor’s (Kevin Rudd) Achilles heel today, amounts to nothing more than activity freeze. More concerning is that the back flips are not supported with answers pertaining to the original decision -making processes. The Emperor today, is taking plenty of steps back and very few steps forward. The wind has left his sails. Too much, too fast, results in chaos!

Somewhat ironic following the global financial crisis (GFC) that the government of the day keeps back flipping with an abundance of poor policy execution, that does not promote business confidence. Ironic, in the sense that these, either deferred or cancelled policies, now equate to increased unemployment.  It is said that “a picture is worth a thousand words” so this week’s picture is dedicated to the failed economic policies and chartered courses of Fort Fumble and Fort Crumble.

BUY PRINT

Our Virtual Realty News research department (me) is always looking to give subscribers relevant and interesting data and we found just the thing  – IOU AUSTRALIA. The website says “Dedicated to delivering accurate information based on Australia’s debt situation in a real time snapshot. Numbers are based on public information, and are adjusted to reflect the information given out by various organisations time to time. Figures represent our nation’s financial health, and the debt we may leave for our children and future generations.”

Again, Fort Fumble and Fort Crumble lead the way – this is scary, have a look at Debt Clock Australia. I will try to obtain the relevant data and what the figures resembled when The Emperor took over the throne. Tony Abbott’s razor plan to pay off our debts is a good start given spiralling government costs add to deficit pressure as MPs fear Kevin Rudd is losing control.

Not as bad as Greece which today, has an estimated $430 billion, Sea of Debt – although one must remember that once upon a time its debt too, was just a fraction of what it is today. Greece has a deadline of May 19 to pay down its debt and the odds of doing so are looking like 430 billion to one. Greek debt fears rock US, European stock markets and the banks must not let Greece fall.

Sydney, you are the weakest link: survey and the latest quarterly Access Economics business outlook report, tips NSW to underperform again, during this next mining boom as interest rates, push up the Australian dollar and harm manufacturers and tourism operators in NSW. State is paying double for land Fort Crumble is paying up to double for land as part of a $250 million property buy–up for public housing.

Premier Keneally less popular than Barry Unsworth identified that if an election had been held in NSW last weekend, the Labor government would have been slaughtered. Charlie Aitken wrote on his Under The Southern Cross this week, “I did a bit of driving over the Anzac Day long weekend and sometimes you just have to wonder where your tax dollars go. How, for example, can the F3 Freeway north of Sydney, that basically is the gateway to Australia’s fastest population growth corridor, end at a roundabout?” Hypothetically, if another election was run this weekend the results would have been worse Melbourne set to overtake as biggest metropolis a 10 – year fall in the percentage of migrants settling in NSW and the lowest rate of economic growth of all mainland states has Melbourne on track to overtake Sydney as Australia’s biggest city.

With the First Home Buyers Grant (FHBG) you can artificially stimulate property markets, but the same can’t be said for Australian financial cash markets. Recently, I have been speaking with some of Australia’s greatest financial minds and some are predicting inflation hitting north of 10 per cent. The Real Estate Institute of Australia (REIA) issued this week an alarming media release – Caution required on interest rates otherwise known as an economic storm warning.  The reason why?

Alcohol and cigarettes went up +3.5 per cent at midnight last night The Emperor added another 25 per cent increase to cigarettes that will drive interest rates up further– nice one Kev! An ongoing economic failed strategy that now has him called Captain Chaos or the Prime Minister for No Economic Idea! Frustrated that nobody has picked up on the fact that a 25 per cent increase on the price of cigarettes, will drive interest rates higher and higher – even if you don’t smoke!

Inflation jump drives rate rise prospect given inflation rose in the March quarter more than expected. Inflation rose 0.9 per cent which equates to a rise of 2.9 per cent in the year to March, according to the Australian Bureau of Statistics. Housing is the major culprit which increased by 6.1 per cent due to increases in electricity (+18.2 %), sewerage ( +14.0 %), rents (+4.6 %), house purchase ( +4.1 %) – the major DNA for these increases lies with state governments that keep driving  these utilities up and they (as well as inflation) won’t be going down!

Throw in housing shortfall locking out thousands where Australia has 178,000 more potential home buyers than available properties, with Queensland and Western Australia accounting for almost half the total shortfall over the past decade according to the National Housing Supply Council. On present trends, the total gap will reach 640,000 by 2029. Such shortfalls are a guarantee that home prices will continue to rise as too, will rents. Here is a crucial graph that will now feature prominently, in future editions of Virtual Realty News.

Pay particular attention to the quarters of March and June 2007/2008 and September 2008/2009 pre global financial crisis – the greatest clue as to where the cash rate is headed. It certainly does not help when Fort Fumble is considered to be in total chaos over policy. Only Health remains. Ironic that inflation looks like exploding and our Federal Government is showing signs of imploding despite an election looming.

To make matters worse Kevin Rudd’s great ETS fraud found out – Andrew Bolt and “the greatest moral challenge of our age” decision to put climate action on hold smacks of political cowardice.

For mine: Paul Kelly from The Australian filed the most compelling read Rudd’s dangerous climate retreat. “As retreats go, they come no bigger than Kevin Rudd’s delaying of his once cherished emissions trading scheme – one of the most spectacular backdowns by a prime minister in decades.” Not a case of stand and deliver, rather ‘The Emperor running to them hills’. Then we have this pearler Department of Hot Air costing $90 million where the 400 public servants employed in the Climate Change Department will remain employed despite no work until 2013.

Check roof insulation before buying a home: Archicentre the building advisory group advised that vendors are not legally required to reveal if the home they are selling has been part of the Federal government’s scrapped home insulation scheme. Fort Fumble’s $2.450 billion home insulation scheme has been linked to four deaths and more than 120 house fires.

The much awaited Henry Tax Review will be released this Sunday and one could not rule out yet another Fort Fumble back flip.

Also, next week we will be revealing a real estate individual website first when we announce which company will be advertising its product on our website – property pages and daily email alerts?

Clues will be left on our blog –  banking or media? Maybe a property portal, newspaper group, or search engine?

Whatever, the case they want the thousands and thousands of eyeballs that RWM attract each and every week. Clue one – their business model loves bricks and mortar?

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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30.04.10Robert Simeon9 Comments »

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I did a Google (Australia’s most visited website) key word search on Global Financial Crisis (GFC) this week and found 33,400,000 results that identify just how popular this acronym has become since its creation in late 2007. Australian Policy Online this week published an interesting report The economic vitality report: the impact of the GFC on Australians. This report draws some interesting conclusions namely:

• The GFC proved to be more a slowdown than a recession in Australia.
• In early 2009, there was a high level of concern regarding the economy. This was short lived, owing to effective fiscal and monetary policy measures, and by the end of 2009 the economy gained momentum (recently confirmed by economic growth data).
• The GFC had a different impact on different age groups.
• Indicative of the success of economic policy, spending across the board increased and spiked, following government cash handouts and tax cuts. There was no evidence of consumers having a frugal Christmas in 2009.
• Even though the economy improved throughout 2009, more consumers felt their personal circumstances had declined.

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With one hundred percent confidence we can advise that this week’s picture is of Garden Island – just don’t ask where the garden or island is?

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Tim Mooney Photography

Whilst in Australia economic growth is expected to continue the latest Westpac – Melbourne Institute leading index indicated that the likely pace of activity three to nine months into 2010 posted an annualised growth rate of 6.3 per cent. This is well above the previous predicted growth rate of 2.7 per cent.

Encouraging – although what we do know is that whilst temporarily marinated in the GFC, Australia has a systemic infrastructure epidemic emerging (actually it has been there for years). Lack of housing will challenge recovery – Reserve Bank of Australia (RBA) assistant governor (economics) Philip Lowe said “the rate of increase in homes has been below the average of the past fifty years, while population has increased at its fastest pace over the same period.”

Stockland managing director Matthew Quinn was much more succinct, declaring that Australia faces a housing affordability “time bomb”. “Australia’s current shortage of 200,000 homes and an annual shortfall of 60,000, would balloon to 800,000 by 2020, if no reforms were undertaken.” This is what I have been saying for ages. The hopeless and misguided Nation Building expend – a – thon is nothing more than an economic embarrassment where housing not schools, should be the priority.

Housing shortage to quadruple Australia’s shortage of available homes will more than quadruple to almost half a million by 2020 if the nation doesn’t increase the pace of construction. The Housing Industry Association (HIA) identified a need for 466,000 new homes to be built by 2020 (currently down by 109,000).

We need a population strategy although Fort Fumble (Federal Government) would point to this week’s announcement by the Australian Bureau of Statistics that new home starts rose by 15.1 per cent (40,022 commencements) in the December quarter of 2009. This is the biggest quarterly increase since 2001 (an 11 per cent increase from the September quarter).
Hold off the celebrations. The real Litmus Test will be revealed with the March quarter results when we see the effect on the real market after the First Home Buyers Grant was removed. More on struggle street as prices, rate rises, the average size of a home loan has risen by forty per cent since 2005. More than half a million Australians are now struggling to meet their repayments according to Fujitsu’s Mortgage Stress survey and rates are heading up not down.

Throw in this week’s announcement from Fort Crumble (NSW Government) that electricity bills will raise by a cumulative total of 64 per cent by 2013. The Australian Chamber of Commerce and Industry advised the RBA this week to hold fire on interest rate hikes until they have a better understanding of the Australian economy. I predict a March quarter decline from the December quarter results for home prices in some areas – given March is the first quarter minus the First Home Buyer Grants.

Our top – end markets will continue to do well because being close to the Central Business District, infrastructure is already in place. However, for those heading west, things can only get worse as all infrastructure initiatives have now been curtailed. Fort Crumble is a classic example as it has absolutely no infrastructure policies on its respective radar. The Australian published this week a very interesting graph that identifies how well our top – end markets are progressing following the GFC Wealthy buyers push prestige prices up.

What can’t be ignored is our congestion problem. Fort Crumble has canned all transport infrastructure initiatives because it is broke. The State of Australian Cities Report identified that productivity growth in Australia’s seventeen capital cities (populations greater than 100,000) was critical to our economy. Australia faces a $20b congestion problem where road congestion, estimated at $9.4 billion in 2005, was likely to rise to $20 billion by 2020. Population boom means double trouble for the west with Sydney’s population due to balloon 40 per cent in 30 years. New forecasts reveal the number of people in the south – west will more than double while those in the city centre will leap 60 per cent. Not a fantastic outlook given Road congestion tax mooted is congestion the toll for a free road? As there will be no need for listening to radio as consumers will be listening to electronic government toll contribution sounds as they drive around Sydney.

MOSMAN HOUSE & SEMI SALES SAME PERIOD 2009 – 2010

1 JANUARY 2009 TO 18 MARCH 2009 – 1 JANUARY 2010 TO 18 MARCH 2010

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• 2009 – Total properties offered 50
• 2010 – Total properties offered 62
• 2009 – Total properties sold 40
• 2010 – Total properties sold 53
• 2009 – Auction 3 sales
• 2009 – Private Treaty 37 sales
• 2010 – Auction 33 sales
• 2010 – Private Treaty 20 sales

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Note: When we publish the weekly sales each week (Click Here). The previous week’s ‘withdrawn’ or ‘passed in’ auction properties (strangely some week’s later) now appear as Sold Auction results.

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• 2009 – Total Value Sold $110,025,000
• 2010 – Total Value Sold $83,754,000
• 2009 – Average Price $2,821,153
• 2010 – Average Price $2,263,621

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We will be updating these sales results every few weeks for your observation.

Figures provided from Domain Property Data

Household finances worsen as rates rise and Wayne Swan has advised that business will be consulted on tax review which will be released before the May 11 budget – so work on May 10 – Fort Fumble refuse to release this working paper (due in March). Even better, the Fort Crumble Fudge-it which is close to being declared as insolvent. Watch this Saturday’s state elections in Tasmania and South Australia with interest.

Kevin Rudd hits new low with voters –  The Emperor can ill afford any huge swings from the Labor faithful given that he is next up on the election front.

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, Balmoral real estate, Neutral Bay real estate, Cammeray real estate Click Here

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19.03.10Robert Simeon9 Comments »