State of Australian housing market

All I know is that I'm getting a heap more real estate alerts about Brisbane property for sale than I did 6 months ago.

Also the houses for sale Brisbane northside seem to be sticking, one in our street has been sitting vacant for at least 6 months, they dropped the price by $50k about 3 months ago.

It's the same on the southside of Brisbane,and this will be only the start no different from last time or the time before that,look back on the last 11 years and the huge demands for funds from various lending sources and the low interest rates,but the problem now is prices cease to rise,and they may well even fall ..
willair.
 
If Steve McKnight said that then thats a little puzzling. What is his logic? That things will improve after 5 months? If thats his thinking then is his investment strategy one that involves NOT buying when the market is down (i.e. next 5 months) but buying when its up\recovers? i.e. (after 5 months) - sounds a little daff

He believes Brisbane will underperform until at least the middle of next year, and that's there's no need to rush in. he obviously believes underperform means further softening of the market. He suggested this is happening because the market was overbought earlier this year. And he is not predicting what happens after that because neither is the data he relies on, like HTW's forecast.



Also the comment from Chris Joye is dead set obvious... if the potential of rising interest rates dont put downward pressure then that would defy logic and their intended purpose... To me his comment is so dead set obvious that it seems almost redundant to even say it..

Would rising interest rates ever lead to upward pressure on property prices?

Do rising rates always freeze or lower property prices? No. From 2003-2007, rates were going up as were cap city medians. Even Sydney rose. in that period.


If anything can be taken from his comments is that he doesnt beleive rate hikes will lead to significant falls...

So you are interpreting "modest downward pressure" as insignificant falls.
How do you interpret this?

Moorooka.gif

 
First I was interpreting their specific comments nothing else.

Second, its an absolute waste of my time giving you my view on the graph you posted because like any graph or stat there are multiple interpretations and you personally will only see it in the way it fits neatly into your own view of the world. However ill still try... but suspect I will fail to make any inroads with you at all.

This graph shows how many people has view pages from realestate.com.au versus the number of listings? It has nothing to do with demand and supply. Its a big leap of faith to see a web-hit as "demand" from one website. If i log onto different computers this will boost "demand", if I list my property with several agents this will boost supply. This is why realestate.com.au had to "define" what they meant by demand and supply in referrence to this graph.

Lets ignore the minor details like this is a graph is showing nothing more than hits on a web page and lets ignore the complete mis-use of the words "demand" and "supply" so much so the website has to qualify their definitions. It should simply be called hit count. If they wanted to show something indicative they could have posted two graphs overlayed one showing "web hits by new IPs" and another showing "new unique listings" given many properties are advertised by several agents.

But if your pushing me for my views on what this graph "indicates" then its this.

  • The rate of web hits is about the same now as it was at the start of the year.
  • The number of web hits has been declining in line with rate rises and talk of rises
  • The number of new listings may have increased because of non-sale or the completion of a rush of new small developments which has appeared in the last months. Namely developments on Lyons, Helles, Hansen, Beaudesert all comming in quick succession.
  • It also shows how the fall off has been more gradual compared to the sudden spike earlier in the year, this personally gives me comfort given web hits have dropped off way more gradually than they had shot up, seeing an orderly decline something to be expected given the rate rises.

Do I prefer web-hits to be trending down? No... but nor do I wish them spiking ever higher as they did earlier in the year. Further more web-hits trending down in an orderly fasion is nothing unexpected given as Chris Joye stated;

if the RBA does raise the target cash rate in line with the consensus economist estimate of 5.5 per cent, Australian dwelling prices will be placed under modest downward pressure."

I would therefore suspect people interested in property would decline given thats one of the many intended purposes of rate hikes i.e. dampen (demand) not realestate.com.au definition of it.

I have tried to be as honest as I can be but beleive you will discard my comments given it doesnt fit your mould of the world.



So you are interpreting "modest downward pressure" as insignificant falls.
How do you interpret this?

Moorooka.gif

 
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Second, its an absolute waste of my time giving you my view on the graph you posted because like any graph or stat there are multiple interpretations and you personally will only see it in the way it fits neatly into your own view of the world.

Fortunately, my view of the world is a rational interpretation of hundreds of hours of reading respected researchers. What's your view of the world based on?



The rate of web hits is about the same now as it was at the start of the year.

true, though it dipped in the middle of the year.


  • The number of web hits has been declining in line with rate rises and talk of rises
well, it certainly fell 25% during October.

  • The number of new listings may have increased because of non-sale or the completion of a rush of new small developments which has appeared in the last months. Namely developments on Lyons, Helles, Hansen, Beaudesert all comming in quick succession
those dev'ts account for no more than 6 listings. Even excluding those, listings have steadily doubled from Feb to now. A wise investor would want to contemplate carefully what a doubling of listings means.

Residex has the Brisbane median down 2.6% in the same period....and that generally fits with what I am seeing.
 
With all do respect a "wise investor" will clearly see how un-wise it would be to use the realestate.com.au graph as a graph for D&S and hence not overanalyse it. Because for every development you wish to double the count for supply, i can list you a property listed that has been sold but is kept there for pure "enquiry" purpose an anoying practice done by many agents.

Growth in Moorooka wasnt negative and is why you now jumped up to show Brisbane. Regardless falls of 2.6% (rpdata differs) is generally inline with my expectations.

[/LIST]
those dev'ts account for no more than 6 listings. Even excluding those, listings have steadily doubled from Feb to now. A wise investor would want to contemplate carefully what a doubling of listings means.

Residex has the Brisbane median down 2.6% in the same period....and that generally fits with what I am seeing.
 
With all do respect a "wise investor" will clearly see how un-wise it would be to use the realestate.com.au graph as a graph for D&S and hence not overanalyse it. Because for every development you wish to double the count for supply, i can list you a property listed that has been sold but is kept there for pure "enquiry" purpose an anoying practice done by many agents.

Growth in Moorooka wasnt negative and is why you now jumped up to show Brisbane. Regardless falls of 2.6% (rpdata differs) is generally inline with my expectations.
For anyone that spent the time and went for a walk around Moorooka starting at the Business centre,walking the streets down too all the car yards at one end then up too the start of Yeronga -Tarragindi then one item stands out,the number of lmr sites that are within that total area
unlike Annerly-Dutton Park where most sites are developed Yeronga is priced too high for DA sites,the same as Dutton Park,Annerley is also very high,so Moorooka would be the target zone for development and with the money that has been spent by Woolworths on the re-fit of their
out-let and the new 12 new shops that will be outside Woolworth that will take a lot of walk by trade from the business centre and will change the area..imho..willair..
 
Unfortunately for Woolworths they didnt get WinstonWolfe expert opinion before spending millions upgrading their store in Moorooka. :D

For anyone that spent the time and went for a walk around Moorooka starting at the Business centre,walking the streets down too all the car yards at one end then up too the start of Yeronga -Tarragindi then one item stands out,the number of lmr sites that are within that total area
unlike Annerly-Dutton Park where most sites are developed Yeronga is priced too high for DA sites,the same as Dutton Park,Annerley is also very high,so Moorooka would be the target zone for development and with the money that has been spent by Woolworths on the re-fit of their
out-let and the new 12 new shops that will be outside Woolworth that will take a lot of walk by trade from the business centre and will change the area..imho..willair..
 
Growth in Moorooka wasnt negative and is why you now jumped up to show Brisbane. Regardless falls of 2.6% (rpdata differs) is generally inline with my expectations.


Who says Moorooka growth wasn't negative?

RP Data houses - 485 to 460 in the time I specified.

As you said, there's been a lot of new apartments come on line to skew those apt stats.

Keep talking your book TC. You'll need to in the face of next year's rate rises.
 
Unfortunately for Woolworths they didnt get WinstonWolfe expert opinion before spending millions upgrading their store in Moorooka. :D
Everyone thinks different and the way Woolworths are set with the bottle shop right next door too their main door is a cracker,btw the only area
in a 2 klm's radius of Moorooka that is still below 400k and in the flood zone is Rocklea:),while the others go into a neg-g period places like that still go up in value,happened every other time ..willair..
 
WinstonWolfe, I've been wondering why someone as bearish on property as you, bought a property earlier this year.
 
You'll need to in the face of next year's rate rises.

The RBA has signalled that the latest rise will be the last for quite awhile, thanks to the soaring AU$.

Do you get a kick out of being a scaremonger WW? Do you seriously think the world is going to end just because you say so?
 
WinstonWolfe, I've been wondering why someone as bearish on property as you, bought a property earlier this year.

Probably because I have a more considered and multifaceted RAR approach to balancing my investing in asset classes and human capital, than your simplistic and bipolar 'either property bull or bear' perspective.

We might have bought the last property on a dual consideration that incorporated a deal to get one of our sons a builder's apprenticeship and permanent f/t builder's labourer job in a tight market. According to your wads of experience, what return do you think that apprenticeship will achieve?
 
Amazing how defensive people get when someone shares their opinion about a downward market. That's naturally on a property forum... but I guess I'm more surprised by perhaps the train of thoughts and hence quality of investors.

What do the website hits say? Well it's all about relativity. If there're double counting of listings now, there were also double counting of listings when supply was apparently low. Therefore, on a relative basis (ie comparing now and say one year ago), the market has softened significantly and supply has increased significantly.

As usual, blind faith is clouding the bulls' judgment, which is well summarised by WW as simplistic and bipolar.
 
What do the website hits say? Well it's all about relativity.

I thought the same thing - a trend is demonstrated, surely?

there are many sicknesses befalling the outlook for property. all this tempered with population growth/reduced development/resources boom. It's an arm wrestle but i think the downward pressures are possibly greater than the upward pressures.

If we take a step back - is there any reason why a house today shouldn't be worth what it was in 2000, adjusted for some inflation on building costs perhaps?
 
Do you get a kick out of being a scaremonger WW? Do you seriously think the world is going to end just because you say so?
Do you seriously think that "positive thinking" can prevent bad things happening?

I have never said prices will drop 40% BTW. I know our market has little in common with the US and even there prices haven't fallen that much in the financially sound states. But I lived through the inflationary '70s - '80s and realise that inflation is very much an attitude or expectation.

Then, you would get a new price list from a supplier, and when you raised your eyebrows you were told "But we haven't put up our prices for three months!!!" Everyone just expected it. It was that way in RE for many years too and we have lived with inflation all our lives. The result is that we can't comprehend how "deflation" could happen. I've been thinking about it for some time and all it would take is a change of expectation to "little or no growth" for this to be self-fulfilling.

Prices would need to drop quit a lot before land bankers and builders shut up shop and strangled supply.
 
I didn't think there was anything in my post that warranted such hostile reply.


Probably because I have a more considered and multifaceted RAR approach to balancing my investing in asset classes and human capital, than your simplistic and bipolar 'either property bull or bear' perspective.

I guess I do have a simplistic perspective. I'm either bullish, bearish or somewhere in between. If I'm bullish I might buy something. If I'm bearish I might sell something. If i'm in between I will generally do nothing. I've found that works for me. If buying property around the top of the cylcle to balance your investments works for you then that's great.

We might have bought the last property on a dual consideration that incorporated a deal to get one of our sons a builder's apprenticeship and permanent f/t builder's labourer job in a tight market. According to your wads of experience, what return do you think that apprenticeship will achieve?

Gee! 'a deal to get one of our sons a builder's apprenticeship and permanent f/t builder's labourer job' Sounds like the deal of the century. Don't worry about my experience. We are just lucky here at Somersoft to have had you sharing your your wealth of experience for so long. Longer than you've even owned IPs for Bruce
 
Not at all. But being overly negative can be self fulfilling. Wasn't it FDR who said "the only thing we have to fear is fear itself."
You SERIOUSLY quote a politician as a financial literate?????????

So You have no fear! ergo bad chit cannot befall you.

You really should write books and give up investing.
 
You SERIOUSLY quote a politician as a financial literate?????????

Who else should I quote? Most academics I know aren't all that financially successful. In any case, there's no arguing the fact that FDR got the USA out of a terrible economic mess.

No one is saying that bad stuff doesn't happen. But life goes on and things eventually get better. Argentina excepted, it's a rare thing to see most developed economies going from 1st world to 3rd world.
 
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