Australian (ASX) Stock Market Forum

Well despite all the prophets of doom spreading their usual wares freely here on ASF, property prices in all Australian capital cities (except Perth) have continued to rise during May this year according to RP Data:

From: http://www.rpdata.com/images/storie...ata_rismark_home_value_index_june_30_2010.pdf



Cheers,

Beej

Who talks doom? There are many who speak in fundamental terms and question real value, but spreading doom, not so.

And a month (May) is a long way away on the changing of the tide. The quarterly report around September may indicate what is really happening now.
 
Well despite all the prophets of doom spreading their usual wares freely here on ASF, property prices in all Australian capital cities (except Perth) have continued to rise during May this year according to RP Data:

From: http://www.rpdata.com/images/storie...ata_rismark_home_value_index_june_30_2010.pdf



Cheers,

Beej

Did you not notice the title Beej?

Australian housing market continues to cool in month of May

Forget the quarter until May. That's like saying the 10 years until May 2010 have shown 100% appreciation. No fool is buying that kind of spin anymore.

What actually counts is May's results when compared to the previous month.
The growth was an anemic 0.5% in May. Care to post a link to an article showing April's numbers, and possibly March's?

Also any guesses as to what June's will be?

Thanks
 
Did you not notice the title Beej?

Forget the quarter until May. That's like saying the 10 years until May 2010 have shown 100% appreciation. No fool is buying that kind of spin anymore.

What actually counts is May's results when compared to the previous month.
The growth was an anemic 0.5% in May. Care to post a link to an article showing April's numbers, and possibly March's?

Also any guesses as to what June's will be?

Of course the market is cooling! If you read back to posts from as long as 2 years ago you will find that this has all played out pretty much as I expected back in mid 2008, except that the growth in 2009 was far higher than I had anticipated.

The May figure of +0.6% is still a healthy rise, which translates to an annual pace of +7.2% nationally. Houses grew at a faster rate than this in all cities while units under performed, so expect the ABS stats to show even higher growth numbers for the June quarter than RP-Data.

Yes the rate of growth is slowing, June will likely show slightly positive (+0.2/0.3% maybe), flat, or possibly even slightly negative growth, although I don't think the auction clearance rates yet suggest negative growth, and housing finance growth seems to be bottoming out also based on today's RBA figures, so most likely outcome will be flat to slightly up again for June I think.

More interesting quotes from the article:

According to RP Data’s Tim Lawless, Melbourne’s value growth has been spectacular.

“When you include the strong capital gains recorded prior to the GFC, which was 21 per cent over the 2007 calendar year, Melbourne home values have risen by 51 per cent in less than 3 and a half years. The gap between Melbourne and Sydney dwelling prices is now just 7.2 per cent, which is the narrowest on record.”

... and ....

Other leading indicators suggest that the Australian market remains relatively healthy. The total number of properties available for sale is about the same as last year, with RP Data currently tracking 207,664 properties being advertised for sale – almost identical to the figure from 12 months ago (207,788 homes). The average selling time is now about 39 days for houses and 31 days for units. The average level of vendor discounting remains at about 5.5 per cent suggesting vendors are not having to cut prices dramatically to sell a property.

So during the period that ASF has been discussing house prices and many have been predicting a massive crash, prices in Melbourne have increased by over 50%!!!! So a 33% correction now (which just does not look like happening) would still only take prices in Melbourne back to where they were at the beginning of 2007.

Plus for sale volumes are steady year over year, so no big rush for the exits evident, no wave of interest rate induced forced selling, and no significant increase in default rates etc etc etc. And more on this from the article:

“The market’s underlying fundamentals are such that any material fall in home values is unlikely. Housing supply remains very low at a time when housing demand is healthy, interest rates appear to be on hold for the foreseeable future, and the Australian economy is performing well compared to all other developed countries”, he said.

Consistent with the moderation in housing market conditions, Rismark’s latest estimate of Australia’s “dwelling priceto-income ratio” remained steady at 4.6 times. This is in line with Rismark’s estimate of the average national dwellingprice-to-income ratio since the end of 2003 of 4.4 times. In a recent speech, the Deputy Governor of the RBA Ric Battellino confirmed this analysis, which is the first to compare all-regions dwelling prices with all-regions incomes, commenting:

Oh so if we look at all dwellings across the country we see that the average price to household income ratio is 4.6?? Barely unchanged since 2003 when is was 4.4?? Didn't some US hedge fund manager recently tour Australia telling us that our houses were 7.5 times family income? Sounds like he really had no idea what he was talking about??

Cheers,

Beej
 
New home sales slump, prices stagnate

RP Data says ""With disposable household incomes forecast to increase by only around 5 per cent in 2010, we have long predicted subdued dwelling price performance for this year," he noted in the report."

Really? :headshake


The spruikers are really struggling now..

"There is no sustained upward momentum in new home sales in 2010 because higher interest rates and concerns over the threat of further rate hikes are dampening demand," he noted in the report. "

Is that code for we need more free taxpayer money (FHBG) to prop us up?
 
New home sales slump, prices stagnate

RP Data says ""With disposable household incomes forecast to increase by only around 5 per cent in 2010, we have long predicted subdued dwelling price performance for this year," he noted in the report."

Really? :headshake


The spruikers are really struggling now..

"There is no sustained upward momentum in new home sales in 2010 because higher interest rates and concerns over the threat of further rate hikes are dampening demand," he noted in the report. "

Is that code for we need more free taxpayer money (FHBG) to prop us up?

Cam, well said.

This is all happening with the cash rate at only 4.5%. The drivers for price growth have disappeared. No wonder the likes of the REIV are begging for zero stamp duty for FHBers.

I am guessing that the spring selling season will exacerbate matters.
 
and the PM's partner Tim Mathison is a ...wait for it........RE salesman.....
I doubt she will be the PM after the next election....but then again I could not believe the crowd would vote Rudd in....so I could be wrong on the political front
 
and the PM's partner Tim Mathison is a ...wait for it........RE salesman.....
I doubt she will be the PM after the next election....but then again I could not believe the crowd would vote Rudd in....so I could be wrong on the political front

Kincy, are you saying that Gillard won't be getting any action;) unless she maintains the RE price bubble for her partner?

D E S P E R A T I O N
 
Of course the market is cooling! If you read back to posts from as long as 2 years ago you will find that this has all played out pretty much as I expected back in mid 2008, except that the growth in 2009 was far higher than I had anticipated.

Mid 2008 "before the GFC" and it played out as expected? Was that just luck?

If growth in 2009 was far higher than you anticipated, would that have anything to do with interest rates being at their lowest levels ever?

No need to answer, we know it was. It comes second to any people rolling their money over from shares.
 
hello,

yes Camkawa, the FHOG should be increased to be exactly the same as stamp duty

ridiculous a person pays 4-5% of purchase price in stamp duty, cut the FHOG and cut the stamp duty

lets see, on the Melb median of 480k stamp duty around 23k, the FHOG at 7k is still way out of whack

and the 7k is holding the market up! hahahahahahaha

23k for buying a secondhand house, zero them both

thankyou
professor robots
 
hello,

yes Camkawa, the FHOG should be increased to be exactly the same as stamp duty

ridiculous a person pays 4-5% of purchase price in stamp duty, cut the FHOG and cut the stamp duty

lets see, on the Melb median of 480k stamp duty around 23k, the FHOG at 7k is still way out of whack

and the 7k is holding the market up! hahahahahahaha

23k for buying a secondhand house, zero them both

thankyou
professor robots

Why not just print a load of cash and drop it from a helicopter? Hang on...
 
and the PM's partner Tim Mathison is a ...wait for it........RE salesman.....
I doubt she will be the PM after the next election....but then again I could not believe the crowd would vote Rudd in....so I could be wrong on the political front

WRONG on the RE salesman remark - Mr Mathieson says his rural background and his 30 years experience as a hairdresser make him uniquely suited to the role. "Let's face it at the hairdressing salon women or men open up way better than they do with a psychologist, a psychiatrist or in a doctors or GPs," he said.

http://www.dailytelegraph.com.au/li...e-than-a-handbag/story-e6frf00r-1111118137859 By Sue Dunlevy From: The Daily Telegraph November 25, 2008 12:00AM

He now is a glorified manbag to the PM.
 

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hello,

why not get rid of them both? $0 grant $0 stamp duty

let everyone pay tax for any short fall, thats the socialist model everyone wants here, lower prices on RE so all can enjoy,

let the bludger at your office get a free ride, the guy always hiding in the toilet or the one on 10 smoke breaks (+lunch and morning tea),

its like public(free) housing, you have to contribute

thankyou
professor robots
 
Gillard's partner, Tim Mathieson, is a real-estate agent employed at a company owned by Melbourne developer Albert Dadon, a well-known supporter of Israel, according to the report.

http://www.jpost.com/International/Article.aspx?ID=179898

I am inclined to believe she would be influenced ......
he has not been a hairdresser for years

I stand corrected ..... more investigating is going to be required on this matter. It appears in 2009 he quit hairdressing and was an ambassador for beyondblue?

"Tim's commitments as a men's health ambassador take up most of his time and he's no longer a hairdresser. Already in 2009, he has spoken at seven men's health forums with many more planned."

http://www.beyondblue.org.au/index.aspx?link_id=59.1159

Maybe he has seen the light on real estate and decided to get a piece of the action?
 
Aaaaaaaaah Kincella ..... I should have known better to doubt you !

PRIME Minister Julia Gillard has defended the right of her partner Tim Mathieson to work for a property group owned by a pro-Israel lobbyist.

Mr Mathieson is employed as a real estate salesman at a company owned by Melbourne developer Albert Dadon, a prominent pro-Israel lobbyist.



Read more: http://www.news.com.au/breaking-new...es/story-e6frfku0-1225885615313#ixzz0sKGEq16c

:bonk:
 
More from the RBA’s Deputy Governor Ric Battellino

http://www.rba.gov.au/speeches/2010/sp-dg-150610.html

As you know, household debt has risen significantly faster than household income since the early 1990s.

Most of the rise was due to housing debt, including debt used to fund investment properties.
All countries have experienced rises in household debt ratios over recent decades. Clearly, therefore, the forces that drove the rise in household debt ratios were not unique to Australia. The two biggest contributing factors were financial deregulation and the structural decline in interest rates.
Therefore sustainable property prices will be unique to Australia then?

This structural decline in interest rates has facilitated the increase in household debt ratios because it reduced debt-servicing costs (Table 1). Households have therefore found that they can now service more debt than used to be the case.
are Australian households over-geared?

I don’t think it is possible to give simple ‘yes’ or ‘no’ answers to these questions.

However, looking at a broad range of financial data, and considering the fact that the Australian economy and financial system have exhibited a high degree of stability over many years, despite the many global events that have tested their resilience, is, I think, grounds for confidence that the economic and financial structure that has evolved in Australia is sustainable.

There we have it, Australia is sustainable "economically" and "financially".

So, no property crash.......

But will there be more property growth without further interest rate reductions? That's what these new property investors should be considering.
 
hello,

why not get rid of them both? $0 grant $0 stamp duty

No, jua remove the FHBG and keep stamp duty, like in the good old days.


Or scrap them both, and introduce CGT and index it (for both property and shares).

CGT 50% has fuelled speculation in both the sharemarket and property, and it should be reversed.
 
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