What Australia Really Needs is a Reality Check – Not A Realty Check!!

What Australia Really Needs is a Reality Check – Not A Realty Check!!

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Australia today, is considered to be one of the most expensive countries in the world in which to reside. The big question is why?

In a report on the world’s 50 most expensive cities Tokyo came in as the most expensive and there are only two Australian cities that don’t appear – Darwin and Hobart. Sydney comes in at 11th (previously 14th), Melbourne 15th (previously 21st), Perth 19th (previously 30th), Canberra 23rd (previously 34th), Brisbane 24th (previously 31st), and Adelaide 27th (previously 46th). That nearly puts us in the top 25 (for argument sake it really does) and the Carbon Tax could push us further up the scale (given that the report was compiled on June 12, 2012). To put this into perspective, London came in at 25, New York 33, Paris 37 and Rome 42. On that basis, when the report is compiled, Australian cities could very well fill the top 10 places. Now that’s scary!

Little wonder this week, Treasury warns Labor on big – ticket spending plans Treasury secretary, Martin Parkinson, said he expects global volatility to extend for the next decade, making it increasingly difficult to fund expensive government policies without corresponding spending cuts. This paints a most alarming economic scenario considering BIS Shrapnel’s sixth review of maintenance industry revealed that spending was not keeping pace with the investment surge in public infrastructure and mining over the past decade.

Throw in tax revenue outlook ‘desperately bad’ Henry warns that governments will be unable to fund the nation’s ballooning infrastructure needs unless they can extract more tax revenue from the economy. Why? Well Australia’s population is expanding at record levels and the Carbon Tax is a business killer.

BUY PRINT

Population clock is ticking for O’Farrell – The Australian Bureau of Statistics calculates that Australia gains one net person every 92 seconds. “When the Rudd government came into office in 2007, Australia’s population was 21 million. By the time Labor’s second three – year term is scheduled to end next year, the population will be more than 23 million. It will have grown by 2 million in just six years. That’s never happened before, not even close.”

I always laugh when I read reports emanating from The Economist: Australian house prices down 2.1% over past year but still 36% overvalued. So yet again we see Sydney’s Lower North Shore property markets leading the way – no white collar recession as rich and middle class keep up with mortgage payments. To try and settle property market confusion, Sydney’s property clearance rates are healthy – APM’s 244 auction results show 56.6% clearance rate. When auction clearance rates hover between 55 percent and 65 percent, we know the market is alive and well. When they move from 66 percent to 75 percent, the markets are overheating, when they go above 76 percent,the market is booming and this inevitably leads to a massive crash.

There was a 10 percent increase in stock levels this week for houses in Mosman which, (hopefully) will increase over the next few weeks. I seriously doubt that the cash rate will drop below 3.5 percent in 2012 as it appears that the Reserve Bank of Australia (RBA) is observing a modest recovery.

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Whilst finally the top – end sales spring into action as season turns.

Source: Domain Property Monitors

    MOSMAN – 2088

    • Number of houses on the market last week– 89
    • Number of houses on the market this week – 100
    • Number of houses on the market this time 2011 – 105
    • Number of apartments on the market last week – 85
    • Number of apartments on the market this week – 95
    • Number of apartments on the market this time 2011 – 99

    CREMORNE – 2090

    • Number of houses on the market last week– 12
    • Number of houses on the market this week – 15
    • Number of houses on the market this time 2011 – 13
    • Number of apartments on the market last week – 15
    • Number of apartments on the market this week – 18
    • Number of apartments on the market this time 2011 – 30

    NEUTRAL BAY – 2089

    • Number of houses on the market last week – 15
    • Number of houses on the market this week – 17
    • Number of houses on the market this time 2011 – 7
    • Number of apartments on the market last week – 46
    • Number of apartments on the market this week – 45
    • Number of apartments on the market this time 2011 – 70

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

I agree 100 percent with Australia escaped the GFC through saving and hard work, not luck although the “World’s Greatest Treasurer” would disagree emphatically. “A fool and his money are easily parted” which explains why Australia won’t have a budget surplus any time soon.

We are in a brave new world – about time Australia started thinking and not taking history for granted. In the new ‘real world’, history may not repeat itself however, cash will always be King!

The only problem for our state and federal Governments – cash is the key ingredient missing from their balance sheets. Australia in 2012 is the most expensive country in the world – by a country mile!

Maybe the “World’s Greatest Treasurer” should re – define envy?

Cheers ^__^

5 Responses to “What Australia Really Needs is a Reality Check – Not A Realty Check!!”

  • Ann says:

    Wonder how long it will be before Swan admits that the budget won’t be in surplus?

  • Wayne Swan would only be aware of this only when Treasury informs him – I predict in September when the budget update is due next!

  • Geoff Michels says:

    Robert
    I’m sure you meant Martin Parkinson as Treasury secretary. Martin Ferguson is a Minister.
    Cheers

  • Thanks Geoff – corrected 🙂

  • Brian says:

    Has anyone worked out exactly what the exchange rate factor is in this report on the world’s 50 most expensive cities?

    As regular visitors to the UK and the EU, the Netherlands in particular, we don’t find must change in local prices in the local currency, with the exception of RE, where prices have plummeted. When those prices are converted into today’s A$’s, London, Amsterdam etc. have become very cheap for us.

    There is obviously a huge impact on one’s back pocket when a GBP costs only A$1.52 instead of A$2.70, and an equivalent change in our favour with the Euro. That’s almost a 44% difference just on its own.

    Europeans coming here of course experience the reverse effect. Lately we have been getting a lot of joy from family and friends visiting from overseas who tell us Australia is very expensive now when for years we were told Oz was dirt cheap. We tell them what they told us a few years ago in their home country – stop whingeing !

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