Are we on the cusp of an upswing for property?

[tom32]

Could be a timing issue there...

On farm cross bred lamb prices have been over $140 per head in WA recently - all part of the soft commodity "boom". Certainly an awful lot higher than a few years ago...

A lot of WA Wheatbelt farmers are rediscovering the benefits of running both sheep and crop after over a decade of no-one making any worthwhile money on sheep.

Actually apologies for the hyundai quality remark it is reasonable quality.

I don't know what woolies does to it from the farmgate to the store but it never seems as good as the butcher who in WA are more expensive than woolworths...

Lamb is more forgiving in my opinion and I would cop that from woolworths but beef has to be from a butcher if you are BBQing etc. I guess the caveat is it could be just my local woolies?

 

[The Fence]

Beat me to it HE...lamb at the farm gate is making fresh highs almost daily...and I don't think the farmers are the ones marking it up...

It's a supply demand issue....believe it or not..

 

[HiEquity]

I guess the caveat is it could be just my local woolies?

Not IME. Butchers have their own businesses to protect and are far more fussy about their supply chain. I've known many to actively reject product that arrived not up to scratch. They know they are more expensive and need to compete on quality instead.

Woolies staff just take whatever gets bought by head office - high volumes mean low prices and the quality issues can be dealt with in the packaging... until you fire up the BBQ!

 

[The Fence]

I'm agreeing with you HE...wow...so true about quality and the local butcher as opposed to woolies/Cules.

Also...our aussie farmers are excellent producers of top quality meat and any other food for that matter, so you can buy your Goats heads or whatever for less but a good lamb chop is hard to beat...

 

[Belbo]

We've recently given up buying garbage meat from supermarkets, and even the cheap local butchers (yes, better, but not that much). It's reallly just not worth the appalling taste and texture!

Instead, we have started buying meat from a super-premium place.

Twice the price, indeed, but their rump steak is infinitely better than any supermarket, even local butcher, sirloin or eye fillet.

Thank you, Hugh Furnley-Whittingsall, for reminding us why we are alive, how food animals should be humanely raised and freshly merchandised, and why those who lovingly do so should be paid decently for their efforts.

Honestly, if you can't sit down after a hard day's work and truly enjoy the very food you eat, why the heck bother with all this investment effort?

For clogged arteries, unrewarded tastebuds and unpleasant aftertastes?

Reward yourselves and your families first at your daily table Investors, I say, for you have nothing to lose but your chains (to supermarket slop)!

 

[asdf]

Heard lamb was up to $180 a head in NSW, up over 80% in the last 5 years. Wouldn't mind IPs doing the same...

 

[Amadio]

Buggered if I know. Why is food so flippen cheap in the US? California is a major fruit and vege producer, so perhaps it's due to illegal mexicans working for $4 an hour? But still, wages are less over there, so maybe the food to wages ratio is similar to here?

It's not really. Here is a store I shopped at regularly. Somewhere on the front page are this week's food ads. Bear in mind that the weight is in lbs not kilograms so double the price and then some to get the equivalent $ amount. Also - being the weekly specials they are cheaper than regular pricing.
Looks like meat/ cheese /fruit are similiar in price to here. Some things are more - one little hot cross bun is $1.95!
http://www.draegers.com/

You can find cheaper stores like Trader Joe's (my favourite) but the quality is very inconsistant. It was always pretty easy to get food bills down in the USA because of the fierce competition on weekly specials (loss runners) that the stores ran.

 

[atsim]

Ya just keep soldiering on Sash...good on ya...!

I also believe the next rate move is down before the end of year. Heck...we have a thread where CBA is trying to combat NAB's latest run at the market share....I think they have room to move down...well... they are moving down... on the quiet...but as someone said in another thread..."wait till the media gets a hold of this, it's down down down..."

LOL...

the CBA has offered me a discount of .96% on my loans. Sounds like rates are easing to me

 

[lawsjs]

I've had 8 agents this week call me to find out if I am buying or selling at the moment. Very unusual! Some of these I havent dealt with since '02. All say its 'very' quiet. Admittedly these are mainly Sydney (inner city still OK) but Newcastle seems very slow.

Spoke to a fund manager mate of mine. There are 65,000,000 empty apartments right now in China, and empty offices for every single person! I find that hard to believe but apparently that is true. The 65m number came from electricity connection records, and once it was released and interpreted the data was removed from publication. Country to city migration is around 15m per year, so even if they stopped building right now, there is considerable excess stock for the next few years.

Be nice to know when they might decide to slow things up a bit...

 

[tom32]

Banks Loan assets and potential growth in loan assets - at what price?

I think that is the sleeper issue for our housing market. Proper pricing of risk as banks create loan assets.

While it may seem fantastic for you guys that banks are offering special discounts on LVR's sub 0.6 and indeed some institutions like NAB are nearly targetting these in isolation, i.e. existing customers of other banks, and giving big discounts, you do understand what this may mean for those wanting to buy their first home?

To date pricing has not reflected risk correctly in my opinion the bloke straight out of uni will get a loan on 0.95LVR at say the nominal mortgage rate and others 075% under them who have solid collateral. IMO the market is gradually moving to a greater difference as they should. Those with more equity in the mix should be able to get better rates those with less equity much worse.

What the banks appear to be doing is being prepared now to offer a discount on potentially stronger loan assets or loan assets with strogn collateral which can only mean they will shirk or at least charge accordingly for those who are not so safe, i.e. typically the first home buyer.

I think they should have done it right from the start as to me a bank coughing up 300k to someone for their first loan at an interest rate only marginally higher than that for someone with 3 houses and LVR's sub 50 is ludicrous. I would loan the sub .50 LVR my money before I would give it to a bank if the homes were in capital cities. It is nearly bulletproof loan asset. How this only gets a 1% discount in contrast to someone who is anything but a bulletproof loan asset confounds me? Why is it like this?

 

[bene313]

the CBA has offered me a discount of .96% on my loans. Sounds like rates are easing to me

So because CBA offered you a discount you think rates are easing?

 

[whitegoodman]

I've had 8 agents this week call me to find out if I am buying or selling at the moment. Very unusual! Some of these I havent dealt with since '02. All say its 'very' quiet. Admittedly these are mainly Sydney (inner city still OK) but Newcastle seems very slow.

Spoke to a fund manager mate of mine. There are 65,000,000 empty apartments right now in China, and empty offices for every single person! I find that hard to believe but apparently that is true. The 65m number came from electricity connection records, and once it was released and interpreted the data was removed from publication. Country to city migration is around 15m per year, so even if they stopped building right now, there is considerable excess stock for the next few years.

Be nice to know when they might decide to slow things up a bit...

I have a feeling Jim Chanos might be right, its economic growth is fuelled by cheap money and construction projects and the old bridge to nowhere schemes..

if you want to make a 'bet' on Australian property it makes a lot of sense to see whats going on in China

http://macrobusiness.com.au/2011/04/andy-xie-on-china/

 

[atsim]

So because CBA offered you a discount you think rates are easing?

In my world the rate i was paying has eased. Thats a fact not a thought:

 

[tom32]

I have a feeling Jim Chanos might be right, its economic growth is fuelled by cheap money and construction projects and the old bridge to nowhere schemes..

I wish!

In Australia we have been handing out cash, building 40bn NBN schemes and school halls whether schools want them or not.

We have to build things that make business competitive. Those who need IT infrastructure can get it in capital cities.

Other business wants, good roads, to allow cheap and efficient transport of goods, good ports to allow cheap export and import, good rail to allow cheap transport, good power infrastructure for cheap power inputs etc etc.

Personally I cannot see any material affect an NBN network will have on the business I work for except now the fellas can download bigger porn files overnight...

China maybe is a different story but personally I cannot see how endless amounts of office space and investment in infrastructure is going to make their businesses any less competitive... Only moreso.

 

[knn]

Watch out...

China's construction boom an illusion?

http://m.io9.com/5790596/watch-jarring-footage-of-chinas-massive-ghost-towns

If true, we might follow.

 

[Tom-B]

Watch out...

China's construction boom an illusion?

http://m.io9.com/5790596/watch-jarring-footage-of-chinas-massive-ghost-towns

If true, we might follow.

OK, that's some pretty worrying footage. Makes me want to go out, sell everything I have and buy gold bars.

 

[Aaron Sice]

Watch out...

China's construction boom an illusion?

http://m.io9.com/5790596/watch-jarring-footage-of-chinas-massive-ghost-towns

If true, we might follow.

fark me...again with the bulls**t?

no we won't follow because if you'd bothered to read before posting you'd understand why.

the chinese govt are seeking to house around 200mil of their fringe-urban population into megapoli. they are building it and FORCING their residents to live there by evicting them from 'government land" (although a govt of the people doesn't 'own' anything, technically).

that's the population of australia - every year - for the next 10 years runnning.

now the peasants can't afford to 'own' these apartments so they live on the fringes, in their huddled masses trying to make sense of what just happened to their generations-old farm.

Chongqing's maps are re-drawn every 3 months because the scale of building is so intense.

Have a look at Chengdu as well and a few others in the immediate region.

whether the 'peasants' live there or not is another matter for them to sort out, but for the next 10 years, China will be building it. they WANT to be a first world country and will shake any image and build out any neighbourhood to prove so.

1.3bil people don't just stop needing food, or building homes, or cars, or aspiring to be wealthier.

now back under your rock for some more reading.

 

[bene313]

if you want to make a 'bet' on Australian property it makes a lot of sense to see whats going on in China

Australian shares, property, business, it's all in trouble if China trip and fall.

 

[Deltaberry]

If you were genuinely worried you'd have to get out of this country... not like you'd have a job any more if China crashes

 

[The Fence]

Australian shares, property, business, it's all in trouble if China trip and fall.

So if china falls (how far?) you're saying property will fall the same % as ASX...?