OWEN WILSON FROM MELBOURNE REA GROUP SPEAKS TO RACHEL PUPAZONNI FROM ‘THE BUSINESS’
A sharp decline in listings has seen property giant REA Group’s half year results slide. HOWEVER … in recent months there have been increased inquiries from Hong Kong and China …
AS revealed previously in October 2019 in this report the Hong Kong unrest has seen residents look to Australian property safe haven … hence the Sydney and Melbourne price hike …
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DO you suppose this has something to do with Jean Nassif of TOPLACE lining up with the Ralan Group for more high-rise precincts across Sydney …. ??
PLEASE TELL OTHERS ABOUT THIS! START THE CONVERSATION … WHY BE SILENT??
Owen Wilson speaks to The Business
Updated 7 February 20202
Expires: Saturday 4 January
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SUMMARY …
A sharp decline in listings has seen REA Property Group’s profits slide … revenue was down 6% to $440M taking net profit down 13% to about $153M
A 14% fall in National Listings on its realestate.com.au site was the main driver led by …
-a 17% fall in listings from Sydney
-a 16% fall in listings in Melbourne
The 30% decline in new building starts during the half year period was also bad news for the property group
DESPITE THIS …
-retained its 55 cents a share dividend for shareholders
OWEN WILSON, CEO FROM MELBOURNE
-all the indicators are that the market is in recovery mode; A big increase in buyer activity on their site
-banks are lending
-Sydney’s prices up significantly in recent months
-Sydney and Melbourne leading Australia out of the decline
-recovery in property prices giving vendors the confidence to enter the market
-new building construction down 30% nationally in the half; the peak in new development construction was 2 years ago
-a number of factors caused the decline particularly the restrictions for foreign investors; decline in new project developments for about 2 years
(Mr Owen did not refer to China’s capital controls!)
-the CBA research showed the number of dwelling constructions was falling short of population growth
A KEY COMPONENT IS CHINESE INVESTMENT NOW IN THE GRIPS OF CORONAVIRUS (CV)
-forecast there should be an inflection point in development construction in the middle of 2020
–a key component in Australian housing is Chinese investment
DESPITE the grip of the CoronaVirus …
-in the half the REA Group saw 44% increase in inquiry for Australian property out of Hong Kong
-in the last 2 months of 2019 a 25% increase in inquiry out of China
It would appear the safe harbour of Australian property is even more attractive for foreign investors
-increase in listings in the half in Hong Kong customer numbers and audience despite the CV and the democracy protests
-the democracy protests do not seem to have had an impact on business
-RE Group staff work from home; work digitally from any geographic location
-bushfires in Australia; in terms of the building regulations he submitted we need to think differently about the level of forestation around housing
-most economic forecasters predict one further rate cut this year possibly two; awaiting the impact on the economy of the CV
-further rate cuts will be good for the property market; rebound in house prices; outlook much better for 2020
-largely manufactured downturn through APRA lending restrictions; uncertainty around the election
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