THE DIFFERENCE BETWEEN A FRISKY BUSINESS AND A RISKY BUSINESS !!

THE DIFFERENCE BETWEEN A FRISKY BUSINESS AND A RISKY BUSINESS !!

In the property industry we are calling it the ‘conspiracy theory’ with the property market receiving not a brass razoo nor any encouragement for that matter. Obviously, Treasurer Peter Costello has more faith in the stockmarket than the ailing investment property market as the stockmarket provides the government with rivers of gold. If you are playing the strong stockmarkets, short term gains end up at the Australian Taxation Office on an annual basis. As against the investment property market which is a long term hold where a reduction in the top marginal rate will have just the slightest effect on the bottom line. Not that this is wrong, as the Government is managing an economy that proves to be a successful business – just that now they are telling the property industry to mind their own business.

With many in the industry fast becoming somewhat desperate for a dollar, they would love one for every time they answer the most popular question, “where are all the new properties”? So here it is. It’s self-explanatory as well as alarming for those on the move.

Houses Mosman (2088)
2001 – Sales 445 Volume $690,458,818 Median $1,250,000
2002 – Sales 391 Volume $2,166,335,498 Median $1,700,000
2003 – Sales 376 Volume $802,272,098 Median $1,699,500
2004 – Sales 308 Volume $645,812,157 Median $1,637,500
2005 – Sales 265 Volume $581,583,750 Median $1,835,000
2006 – Sales 39 Volume $68,309,000 Median $1,600,000

Apartments Mosman (2088)
2001 – Sales 679 Volume $382,041,945 Median $410,000
2002 – Sales 725 Volume $433,005,478 Median $452,000
2003 – Sales 569 Volume $371,864,947 Median $475,000
2004 – Sales 474 Volume $308,463,038 Median $473,500
2005 – Sales 475 Volume $359,631,150 Median $520,000
2006 – Sales 50 Volume $30,572,900 Median $470,000

Houses Neutral Bay (2089)</strong
2001 – Sales 81 Volume $96,294,300 Median $977,000
2002 – Sales 80 Volume $95,275,900 Median $934,250
2003 – Sales 68 Volume $94,865,119 Median $1,207,500
2004 – Sales 60 Volume $84,317,898 Median $1,312,500
2005 – Sales 51 Volume $70,360,750 Median $1,080,000
2006 – Sales 14 Volume $14,287,000 Median $947,500

Apartments Neutral Bay (2089)
2001 – Sales 443 Volume $241,201,440 Median $405,000
2002 – Sales 406 Volume $306,993,189 Median $442,500
2003 – Sales 384 Volume $257,289,561 Median $510,000
2004 – Sales 329 Volume $212,461,130 Median $495,000
2005 – Sales 269 Volume $162,042,117 Median $500,000
2006 – Sales 42 Volume $21,320,491 Median $507,500

Houses Cremorne (2090)
2001 – Sales 117 Volume $121,824,287 Median $847,500
2002 – Sales 105 Volume $138,886,150 Median $1,167,500
2003 – Sales 89 Volume $129,347,050 Median $1,252,000
2004 – Sales 79 Volume $112,637,500 Median $1,215,000
2005 – Sales 60 Volume $87,030,000 Median $1,285,000
2006 – Sales 9 Volume $11,230,300 Median $1,175,000

Apartments Cremorne (2090)
2001 – Sales 307 Volume $137,539,912 Median $432,000
2002 – Sales 379 Volume $197,187,483 Median $485,000
2003 – Sales 342 Volume $186,839,989 Median $510,000
2004 – Sales 330 Volume $187,863,337 Median $500,000
2005 – Sales 304 Volume $160,399,783 Median $489,500
2006 – Sales 45 Volume $25,842,635 Median $520,000

Houses Cremorne Point (2090)
2001 – Sales 16 Volume $31,955,000 Median $1,652,500
2002 – Sales 13 Volume $29,840,000 Median $2,350,000
2003 – Sales 10 Volume $31,382,010 Median $2,523,750
2004 – Sales 8 Volume $19,010,000 Median $2,200,000
2005 – Sales 5 Volume $15,335,000 Median $1,950,000
2006 – Sales 1 Volume $4,000,000 Median $4,000,000

Apartments Cremorne Point (2090)
2001 – Sales 69 Volume $55,411,760 Median $640,000
2002 – Sales 60 Volume $115,415,000 Median $1,015,000
2003 – Sales 53 Volume $45,668,100 Median $645,000
2004 – Sales 45 Volume $49,139,000 Median $770,000
2005 – Sales 44 Volume $47,769,600 Median $840,000
2006 – Sales 4 Volume $2,803,000 Median $646,500

Houses Cammeray (2062)
2001 – Sales 94 Volume $74,695,050 Median $660,000
2002 – Sales 89 Volume $93,466,000 Median $870,000
2003 – Sales 79 Volume $89,505,508 Median $975,000
2004 – Sales 72 Volume $90,862,340 Median $952,500
2005 – Sales 62 Volume $80,852,200 Median $960,000
2006 – Sales 10 Volume $8,729,500 Median $845,000

Apartments Cammeray (2062)
2001 – Sales 204 Volume $109,153,801 Median $419,500
2002 – Sales 202 Volume $104,381,773 Median $457,000
2003 – Sales 184 Volume $111,655,518 Median $516,500
2004 – Sales 160 Volume $84,191,196 Median $479,750
2005 – Sales 145 Volume $83,139,783 Median $500,000
2006 – Sales 25 Volume $12,070,145 Median $426,000

Source: www.realtor.com.au

It is said that numbers never lie and our property market is condensing due mainly, to our small population and a combination of high transaction costs. While the volumes keep reducing at such a rate, so do the coffers of the State Government, by way of Stamp Duty and the like. It is getting tougher and tougher, given that the number of real estate agencies is outgrowing available income and resources which will result in a natural culling. When one examines these figures, it is abundantly clear that the landscape that was once perceived as fair practice, is now fair game, otherwise construed as battle on. Welcome to the brave new world of real estate, and it will not just be agents/agencies that need to add a bit of botox to their appeal. We expect that offline marketing alternatives will quickly embrace online support alternatives otherwise known as marketing parachutes. Fundamentally, more than a few are busy in an attempt to seal the leaks of their respective business strategies. Franchise groups will experience a reduction in offices as the more profitable businesses go further afield and expand into new territories.

Sales keep turning over and this week we negotiated three sales with a value of $6,790,000 comprising a confidential property (parties are subscribers), 3 Warringah Road Balmoral and 21/34 Gerard Street Cremorne.

The biggest question (in our opinion) is, will Mosman house sales fall below 200 in 2006 and if so, who will be around to tell the story ? Anecdotal evidence proves that the market is changing. Just who is about to bring out a new wardrobe will be revealed in a short time. It is that simple. Cheers and see you next week ^__^

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