Auction Clearance Rates/Credit Growth/Capital Gains

You are of course, quite right. As discussed previously, these numbers are rubbery as they count sales that occur after being passed in, don't count all sales - as not all are reported, don't always include withdrawn priors etc.

Total properties in SYD were 283 and in MEL 197, BNE 22 and ADL 23 just FYI.
Not trying to have a go at you in any way,but i have also those numbers in front of me,just makes you think how much smoke and mirrors there are in numbers,my only problem is once you have seen property go nowhere for over 5 years in the early 1990's,and i know full wellthat all events are repeatable ,and that alone builds up an innate fear of and what can happen over a 12 month span,on the 'ASX" you can get blown out the back door in amatter of days property is a bit slower..imho.
willair..
 
Not trying to have a go at you in any way,but i have also those numbers in front of me,just makes you think how much smoke and mirrors there are in numbers,my only problem is once you have seen property go nowhere for over 5 years in the early 1990's,and i know full wellthat all events are repeatable ,and that alone builds up an innate fear of and what can happen over a 12 month span,on the 'ASX" you can get blown out the back door in amatter of days property is a bit slower..imho.
willair..

I concur. :)

I smell 1991 in the air now. Merely my intuition and having lived thru that time, I see us ostensibly sideways for about the next five years or so. :cool:

This is a general comment as there are markets within markets, however mood changes are in the air. Whilst it transacts like an elephant comapred to the mouse like nimble stock market transactions at the click of a mouse (yeah pun intended), property mood can sour very quickly.

This happended here in April. A Henry report, the PIIGS, a new budget, the extra miner's impost, another interest rate rise and a runaway property market in Melbourne turned quite quickly. Vendors will need to become more realistic. Some are, however some are just plain silly with their expectations.

Agree that not all properties sold are reported and the media play the story to suit the sensationalist slant they wish that edition to take and to shock the sheeple.

There will be some that do well in the next five years as they buy at softened prices whilst waiting for next tide to raise all ships. These are the pasive ones. The active ones will do well all the time and anywhere. Look at what Nathan accomplishes.

All markets need a breather. Personally my take is that confidence is not as bullish and, like it or not, the property market is also a voting machine; just like the stock market......supply and demand ;)
 
I concur. :)

I smell 1991 in the air now. Merely my intuition and having lived thru that time, I see us ostensibly sideways for about the next five years or so. :cool:

This is a general comment as there are markets within markets, however mood changes are in the air. Whilst it transacts like an elephant comapred to the mouse like nimble stock market transactions at the click of a mouse (yeah pun intended), property mood can sour very quickly.

This happended here in April. A Henry report, the PIIGS, a new budget, the extra miner's impost, another interest rate rise and a runaway property market in Melbourne turned quite quickly. Vendors will need to become more realistic. Some are, however some are just plain silly with their expectations.

Agree that not all properties sold are reported and the media play the story to suit the sensationalist slant they wish that edition to take and to shock the sheeple.

There will be some that do well in the next five years as they buy at softened prices whilst waiting for next tide to raise all ships. These are the pasive ones. The active ones will do well all the time and anywhere. Look at what Nathan accomplishes.

All markets need a breather. Personally my take is that confidence is not as bullish and, like it or not, the property market is also a voting machine; just like the stock market......supply and demand ;)
And here i was thinking that i was the only one:rolleyes: that think on 20 different levels and mix all the numbers in a get adifferent number
to the REIQ in detecting changes in the world around them,all markets are markets within markets Player i'm not worried 1%,after all experience is not what happen to you experience is what you do with what has happened,and i have been brunt more times then a bags of hot chips in the glass hot box at 3 in the morning in a fast food outlet..willair.
 
I have been following the REIV reported figures in Melbourne and this weekend just gone we had the lowest $ volume (across auctions/private sales) recorded since February 6th this year if you don't count long weekend figures (see attached graph).
 

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another few drops last few weeks? are the results you get different to these? (via domain->sold->auction results)

Hey Peter, see graph attached with update. We've seen a couple of weeks bounce in Melbourne (dead cat?), but weekend just been we've seen the downtrend resume. Volume (combined auctions/private sales) is the lowest in 6 months. Winter tends to bring quieter volume historically (but in turn less stock put on market) so probably we can't gauge how bad the Melbourne downturn will be until Spring.

The figures I have been charting are the REIV statistics whereas you have linked APM, they have different methodologies hence there can be a large difference in the clearance rate, however generally they trend the same. I used REIV as the figures were easy to find on the net for previous weeks...

What we are seeing in Melbourne is:
- Rising stock levels
- Reduced OO purchasing/lending
- Dropping volume/turnover

This points to a likely correction in prices come the second half of the year. How bad will it be? A softening in prices if you listen to the bulls, a price crash if you listen to the bears...I expect at best we will see a downturn in Melbourne similar to that we saw in Sydney following 2003, probably at least a 10% correction in prices (over a couple of years) followed by several more with no growth. Welcome back to 1989 Melbourne!

Edit: For clarification purposes I mean the lack of growth Melbourne experienced between 1989 and 1996, not that prices are heading down to their 1989 level :p
 

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I have been following the REIV reported figures in Melbourne and this weekend just gone we had the lowest $ volume (across auctions/private sales) recorded since February 6th this year if you don't count long weekend figures (see attached graph).

Probably shouldn’t compare anything to Q1 2010 as that was a crazy period and an anomaly.
 
You are of course, quite right. As discussed previously, these numbers are rubbery as they count sales that occur after being passed in, don't count all sales - as not all are reported, don't always include withdrawn priors etc.

I've always questioned the point of looking at auction figures other than Sydney, Melbourne and to a lesser extent Brisbane. I see them every week on RP Data but there's not enough auctions in other capitals to take any meaningful insight from the figures (IMO).

Take week of 22/7 from RP Data for example: Adelaide 59, Sold 32 for a 54% clearance rate. How many hundreds upon hundreds of properties sold/settled last week in Adelaide, I couldn't care less what % of 59 houses sold. But maybe that's just me.

Other capitals are even worse: Perth 24 houses, Tasmania 15. Who cares what % results these tiny representations show?
 
I've always questioned the point of looking at auction figures other than Sydney, Melbourne and to a lesser extent Brisbane. I see them every week on RP Data but there's not enough auctions in other capitals to take any meaningful insight from the figures (IMO).

Take week of 22/7 from RP Data for example: Adelaide 59, Sold 32 for a 54% clearance rate. How many hundreds upon hundreds of properties sold/settled last week in Adelaide, I couldn't care less what % of 59 houses sold. But maybe that's just me.

Other capitals are even worse: Perth 24 houses, Tasmania 15. Who cares what % results these tiny representations show?

Steve,it's good you look at the paper facts that way because 99% don't and as the for sale signs-for lease-auction-must sell signs that are starting to pop up each day in the small area we invest in would start to make anyone think,if the listings just sit there and more are listed each day then what's next,when i was picking up the rents this morning one street i drove down half the street is up for sale ,maybe just the election but over the next six months we will see the next stage of the property cycle and i have no problem with that..willair..
 
I've always questioned the point of looking at auction figures other than Sydney, Melbourne and to a lesser extent Brisbane. I see them every week on RP Data but there's not enough auctions in other capitals to take any meaningful insight from the figures (IMO).
Take week of 22/7 from RP Data for example: Adelaide 59, Sold 32 for a 54% clearance rate. How many hundreds upon hundreds of properties sold/settled last week in Adelaide, I couldn't care less what % of 59 houses sold. But maybe that's just me.
Other capitals are even worse: Perth 24 houses, Tasmania 15. Who cares what % results these tiny representations show?
I'd have to agree with that, statistics I recall reading earlier this year pointing to Melbourne holding 50% of all resi auctions, Sydney around 25% and the rest of the cities combined made the final 25%. With current distribution you would only want to be looking seriously at Melbourne/Sydney results or a weighted average.
 
I concur. :)

I smell 1991 in the air now. Merely my intuition and having lived thru that time, I see us ostensibly sideways for about the next five years or so. :cool:

QUOTE]

Personally i dont think it will be as severe as 1991. Australia had a number of structural issues back then, hence the 'recession we had to have'. These structural issues are not present to the same degree.

I think overall australia could still be the 'lucky' country over a 10 year forward period. There will be some rough times, but i dont think it will replicate the 10year forward cycle from 1989.

It could be a little like the US post 1989.
 
I like to keep things simple. Maybe because I day/swing trade so I'm a big believer in that little red line.
So to me a spike is a spike is a spike and usually pays it's dues in the end unless it's justified. The sharper and taller, the more dues . So I know I must sound like a scratched record but our property is way, way up there and points to a 10y min slum but more likely 15-18, which just happens to be my retirement time .
So I'm hoping to be a smarty on this one and have all property payed off by then and ready to either sell off or renting out at 100%cp come the next boom and my retirement .

Cheers

ps , an interesting thing is the best buying is usually 5 or 6 yrs into a slump so I'm also hoping to build a position whereby I can scrape the floor and add a few more at that point if we do go that way .
 
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...............Personally i dont think it will be as severe as 1991. Australia had a number of structural issues back then, hence the 'recession we had to have'. These structural issues are not present to the same degree.

I think overall australia could still be the 'lucky' country over a 10 year forward period. There will be some rough times, but i dont think it will replicate the 10year forward cycle from 1989.

It could be a little like the US post 1989.

Hey IV,

you could be right mate. That is merely my intuition and whilst my reasoning won't be for the same identical issues that we had at that time in the early 90's, the result may be the same.

Ambivalent sentiment and the need to curtail the the rampant bull (property) market we've had, albeit in Melbourne. The run up we have experienced cannot be sustained. Better it cools now and goes sideways than continue and then come down in a thud. :(

This spring will be the litmus test. With datasaphere reporting that we are unlikely to see a rate rise this side of Cup Day, then the next three months will be interesting indeed.

For investors, personally I don't see value in Melbourne right now. Rents will need to catch up to reduce the arbitrage b/w yield and borrowing costs. :cool:
 
One huge difference between now and 1991 is that rental yields are just shocking now. There are going to be a lot of investors who won't be able to hold on for 5 years of sideways movement.
Problem is, they won't be able to sell to other investors for the same price because they'll be wanting better yields.
 
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