Get set for a roller coaster ride through to Christmas (and beyond) where once again it will be the financial markets, not property markets that will attract all the attention. Thanks to the global financial crisis (GFC) we can say to some extent that we have been there and done that – what remains to be seen is how destructive phase ll will be? It looks like being horrific for Europe and the United States.

“A more severe crash than the one triggered by the collapse of Lehman Brothers could be on the way, according to alarm signals in the credit markets. The cost of insuring RBS bonds is now higher than before the taxpayer was forced to step in and rescue the bank in 2008” – market crash ‘could hit within weeks’, warn bankers. This week ANZ chief executive warned World on edge of crisis where he labelled Europe “a mess” and warned that failure by political leaders to tackle economic problems could lead to a much greater global crisis.

Back home there have been some fascinating observations on the political consequences of Australia’s resources boom where the Gillard government is fast-learning that there is more to life than just mining. Labor turns the boom into a crisis a great insight by Paul Kelly, Editor – at – large The Australian. “The crisis now engulfing Australian manufacturing has been long predicted and much foreseen yet the inescapable impression is that our decision – makers have been taken by surprise and are scrambling to do something.”

The government has been caught out and the observers on the hill are not impressed.

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It would be fair to suggest that we are at critical crossroads although Australia’s public debt to GDP ratio is among the healthiest in the OECD at approximately 22 per cent. Sentiment has Fort Fumble not governing, drowning with Julia Gillard back to rock bottom: Newspoll. The ongoing Craig Thomson prostitution scandal further ignites: hard questions will not go away. I don’t believe it will bring the government down – see you Thomson, raise you Wilkie so Australia’s government now hangs on the actions of just two individuals. The flip side – Crean for PM? Why the bookies think it’s not so far fetched. Whatever the case Graham Richardson says the ‘awful smell’ of the Thomson affair won’t go away. Just over 365 days ago the ‘new paradigm’ is looking as vibrant as Australia’s manufacturing industry.

A minority government has proved to be an abysmal failure which has been reinforced in the polls and the reality that Australia’s Prime Minister has until Christmas to turn things around. If you look at Australia’s political history, John Howard lost the 2007 election when he ran Work Choices. Kevin Rudd was done and dusted on the hopeless handling of the mining tax and Julia Gillard will fall over her carbon pricing scheme.

Source: The Australian

Residential and commercial construction remains in the doldrums, according to the latest ABS statistics new home building slumps in June quarter. Obviously “building a better Australia” does not apply to residential and commercial construction? Three population bubbles will cause housing demand, not supply, to skyrocket even though it’s fascinating that rising inflation makes housing more affordable. Well we are not building, so I have to agree with Christopher Joye that house prices will be 55% higher in a decade.

Last week, we revealed the Mosman clearance rates for houses so this week we investigated the adjusted clearance rates for apartments and townhouses. Having looked at the data results from RWM Research Department, I wonder if Mosman has the lowest clearance rates in Sydney.

Here are the Mosman townhouse/apartment sales from 2001 to 2011 – just like the house statistics they failed to reach 50 per cent.

Source: Domain Property Data

• 2001 – 106 auctioned, 52 sold with an adjusted clearance rate of 44%
• 2002 – 114 auctioned, 66 sold with an adjusted clearance rate of 49%
• 2003 – 96 auctioned, 47 sold with an adjusted clearance rate of 42%
• 2004 – 66 auctioned, 25 sold with an adjusted clearance rate of 28%
• 2005 – 89 auctioned, 31 sold with an adjusted clearance rate of 29%
• 2006 – 74 auctioned, 31 sold with an adjusted clearance rate of 30%
• 2007 – 62 auctioned, 38 sold with an adjusted clearance rate of 47%
• 2008 – 95 auctioned, 43 sold with an adjusted clearance rate of 37%
• 2009 – 41 auctioned, 16 sold with an adjusted clearance rate of 27%
• 2010 – 77 auctioned, 38 sold with an adjusted clearance rate of 38%
• 2011 – 48 auctioned, 23 sold with an adjusted clearance rate of 33%

MOSMAN – 2088

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• Number of houses on the market last week – 103
• Number of houses on the market this week – 105
• Number of apartments on the market last week – 98
• Number of apartments on the market this week – 99

CREMORNE – 2090

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• Number of houses on the market last week – 17
• Number of houses on the market this week – 13
• Number of apartments on the market last week – 26
• Number of apartments on the market this week – 30

NEUTRAL BAY – 2089

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

Now this is where it gets interesting – if the Mosman housing market is as strong as we believe it to be the number of houses available should start reducing over the next month.

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

We have been asked to use our database to try and assist finding Daniel who went missing six weeks ago – so if you please see him follow the contact details on the Facebook page – Daniel O’Keeffe.

Let’s hope that next week, the discussion is about economics and not a politician’s callisthenics with prostitutes.  Or should that be a wandering wallet!!

Cheers ^__^

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26.08.11Robert Simeon5 Comments »

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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 »

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Prime Minister Julia Gillard keeps reminding Australians that our economy is the envy of the world – which in all probability explains why Labor’s popularity drops to a record low. Newspoll reported this week that Labor’s primary vote had dropped from thirty per cent to twenty seven per cent (a survey compiled prior to the carbon tax release announcement). If the next Newspoll (due in two week’s time) identifies a further decline, it will be all over for the ‘red rover’.

Economically, Australians are concerned about just the one thing – household debt. A carbon tax for the price of a broken promise it is now boom or bust for ALP’s ideology. Australia is not buying the tax for clean air argument, as it has been acknowledged that Australia’s carbon tax will have next to no effect .Julia Gillard’s carbon price promise when she advised Australia “I rule out a carbon tax” has the prime minister struggling to acknowledge why a promise is not a promise. Of course, if it was not a tax, the prime minister would find Australian sentiment much more forgiving – the old Aussie vernacular liar, liar pants (hair) on fire has resonated throughout the entire debate. Rate rises, global uncertainty, carbon push consumer sentiment to two – year low so what is the common denominator? That would be carbon chaos in Canberra!

Then we have the elephant in the room, otherwise known as the budget deficit which continues to blow out – hence carbon tax on surplus ‘not dramatically significant’. Another broken promise given Treasurer Wayne Swan now admits that the climate change package will decrease the projected budget surplus despite his promise that the package would be revenue neutral. No doubt the Treasurer would have been pleased to see that the Building the Education Revolution waste blows out to $1.1bn which is down from the Pink Batts fiasco which lost $2.45bn. That’s $3.55bn lost due to mismanagement, and to be repaid by taxpayers.

BUY PRINT

Julia Gillard needs a new policy distraction given sixty per cent of Australians don’t want a carbon tax.  Fort Fumble has positioned itself between a rock and a very hard place. Having just back flipped on waiting hours at hospitals, the plan for a federal takeover became so infected that Nicola Roxon gives in to states on health. Then you have stupidity and cattle export revolt cloud Julia Gillard’s clear air where the public consensus is that plenty of pain for very little gain in cattle export fight. The problem with Fort Fumble is that there are too many chiefs and not enough Indians. Australians are smart enough to see that reckless decisions are frustrating and damaging to consumer confidence – Gillard rejects early election call. Prime Ministers are very much like rugby league coaches.  If the team’s not winning, the coach gets the sack – Gillard determined to avoid the axe.

The Australian – Order Bill Leak’s Print

Rent growth slowing in capital cities comes as little surprise.   With households totally focussed on debt, rental debt is no exception. The supply of housing in Australia today, remains a complete debacle housing supply – Melbourne good news, Sydney bad news. Only 141,618 new dwellings were built in NSW between 2006 and 2010 although the number of households increased by 159,388. What part of this do you think that our governments don’t understand? In 2010 NSW built just 27,655 new dwellings where Victoria built a record 50,700 dwellings (almost twice that of NSW). An amazing statistic when, according to the Australian Bureau of Statistics, NSW has a population of 7,272,200 and Victoria 5,585,600. Little wonder that NSW house prices falls smallest: survey and a carbon tax raises the cost of construction of a new home by approximately five to ten per cent! Julia, tell us we’re dreaming – a carbon tax on coal hits NSW coffers hard.

All quiet on the eastern front – You can say that again. Mosman is an interesting study, when in winter, the market all but closes down.  Mosman residents  prefer to travel – hence this week’s amazing ‘for sale’ statistics. Who would have believed there would be just eighty houses for sale Domain Property Data. I have never before seen a tighter Mosman market.

MOSMAN – 2088

• Number of houses on the market last week – 83
• Number of houses on the market this week – 80
• Number of apartments on the market last week – 99
• Number of apartments on the market this week – 92

CREMORNE – 2090

• Number of houses on the market last week – 16
• Number of houses on the market this week –  16
• Number of apartments on the market last week – 34
• Number of apartments on the market this week – 31

NEUTRAL BAY – 2089

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

It’s just getting too cold for me, so I am taking a break for a few weeks. Andrew, Steve and Rich will be providing their collective pearls of property wisdom.

On that note, I would like to thank our first female prime minister for announcing her carbon tax during the school holidays, when so many Australians are away. I do ask the Labor caucus to delay the announcement of Australia’s next prime minister, until I return to Virtual Realty News.

Cheers ^__^

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15.07.11Robert Simeon3 Comments »

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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.

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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 13^th 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 »

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

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

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

BUY PRINT

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

VIDEO ADVERTISING

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

MOBILE ADVERTISING

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

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

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

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

Source: The Australian- order Bill Leak’s print

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

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

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

Source: Domain Property Data

MOSMAN HOUSE SALES MARCH QUARTER 2010

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

MOSMAN HOUSE SALES MARCH QUARTER 2011

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

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

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

MOSMAN – 2088

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

CREMORNE – 2090

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

NEUTRAL BAY – 2089

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

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

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

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

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

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

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

Cheers ^__^

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

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3.06.11Robert Simeon4 Comments »

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Australia finds itself at a precipice (especially if you reside in Sydney) – sea – level rise to hit Sydney worst, warns climate report. In my humble opinion Julia Gillard’s Fort Fumble would struggle to negotiate a pedestrian crossing so I would pay little attention to the findings of the Climate Change Department – otherwise known as the (cash for comment) Carbon Tax Sales Department. Time to end climate denialism, says Gillard government scientific adviser which I agree is a modern day fact of life that needs addressing – just not by a government that is best recognised for bungles (not miracles) of economic management. Australia produces between just one and two per cent of global  emissions, so let’s explore why the emitters of that other ninety eight to ninety nine per cent have decided to do nothing (at this point in time).

That Australia has to wait until July before Fort Fumble announces the actual content of a new tax announced in February, defies common sense. Alas, Julia Gillard tells Labor MPs she’s playing ‘the long game’ and that Abbott’s popularity will fade which is just like saying that I don’t pay attention to the polls. As Alan Kohler wrote this week, Climate change action: make policy not war – “UBS analyst David Leitch has calculated that to achieve (the required emissions reductions) that with a carbon price alone would require a price of $80 per tonne, which is four times the planned starting point for the Labor Government’s carbon tax.” This would explain why the other ninety eight and ninety nine per cent emitters are not addressing the carbon problem.

BUY PRINT

Fort Fumble is now at war with the Western Australia government as Colin Barnett blows a $2bn hole in Wayne Swan’s budget target. Another public relations disaster for Julia Gillard where the threats should have been kept in–house, not broadcast all over the country. Although it later became apparent that the Government knew about WA mining royalties which is now a fine mess to a political brawl between Wayne Swan and Troy Buswell over mining tax. WA facts and figures reveals that Western Australia has been the highest–earning Australian state per capita. The GSP (gross state product) is very impressive and clearly evident.

Prime Minister Julia Gillard is experiencing popularity declines Labor powerbrokers back Julia Gillard despite lowest ever polling and the polls will only get lower. In Queensland the LNP makes more ground in opinion poll and it is very clear that the Rudd state voters can’t wait to dump Gillard. A Galaxy Poll in this week’s Courier – Mail had Liberal National Party further in front with 61 points to Anna Bligh on 39 so another change of government is underway in Queensland. Fort Fumble has brought this discontent upon themselves so no need to feel sorry that nobody is listening which was evident at last week’s Victorian Labor Conference which experienced the lowest turnout.

Source: The Australian- order Bill Leak’s print

Arrears on mortgage repayments spiked to a record high in the first three months of 2011 as Low – doc mortgage arrears top GFC peak. If you look at the Housing Equity Injection, a major player in the determination is credit growth, aggregate demand and employment which then lead to spending sapped by stagnant house prices.

In another interesting first we now see RBA warns many first home buyers who used government grants may now be vulnerable which is somewhat contradictory to an earlier statement that RBA says mortgage stress not a problem – for now. A key indicator is always employment and growth in this sector is weakening which all but guarantees no rate hikes when the RBA next meets, in June.

Consumer spending is another thing to watch closely as that too is getting weaker and weaker. Now, economic data that shows employment, retail sales and housing market activity all declining. One should also take into consideration that all this data coincides with the time of year and we expect sentiment to improve greatly as we get closer to Spring and Summer (always the case).

Here are this week’s property statistics, downloaded for our property markets from – Domain

MOSMAN – 2088

• Number of houses on the market last week – 120
• Number of houses on the market this week – 118
• Number of apartments on the market last week – 101
• Number of apartments on the market this week – 96

CREMORNE – 2090

• Number of houses on the market last week – 21
• Number of houses on the market this week – 18
• Number of apartments on the market last week – 35
• Number of apartments on the market this week – 36

NEUTRAL BAY – 2089

• Number of houses on the market last week – 13
• Number of houses on the market this week – 12
• Number of apartments on the market last week – 60
• Number of apartments on the market this week – 58

So it would be fair to suggest that our property markets are somewhat ‘nonplussed’ which is exactly where we expect our demographic markets to sit for the next few months.

It was with great sadness that we lost one of our original subscribers to Virtual Realty News this week, with the passing of Dr. Bill Bramwell Roberts. “Billy Boy” would often grace our blog as TMW: The Mosman Wordsmith. A great mate of ours and a fantastic husband to Pat and father to Sophie and Victoria. Bill was Mr. Nice Guy to everyone who had the pleasure of sharing his company.

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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26.05.11Robert Simeon5 Comments »