The HOUSING DENSITY Debate … Will Building more Apartments make Property Cheaper?

HOW can building more apartments make property cheaper … from what we have seen so far?

With the AUSTRALIAN HOUSING BOOM particularly in NSW, Victoria, South-East Queensland, and major capital cities including Hobart from as early as 2013 to 2017/18 and again from late 2019 to date house prices skyrocketed … was this because the supply was unable to meet ‘the foreign demand’?

WITH so much overseas competition for our domestic housing … * Temporary Visa Holders lured by a ‘Permanent Resident Visa’ and Medicare benefits … and our Housing Market awash with ‘Hot Money … *a whole Cohort of Australian First Home Buyers have been locked out …

WHO are calling for more units and apartment blocks?

IS it developers, the Property Council of Australia, the Urban Taskforce, the economists helping to shape public policy, to help tackle and address issues such as urban renewal and precinct planning?

CAAN will focus on the interview comments from NICKI HUTLEY a Partner, in Deloitte Access Economics … helping to address urban renewal and precinct planning ... Ms Hutley said:

Image result for nicki hutley

Photo: Nicki Hutley; abc.net.au

‘The population mix of Australia has changed dramatically * and there are a lot of people who have come from Asia who are used to apartment living, who are quite happy with that.’ …

AND …

Land is incredibly expensive particularly in Sydney and Melbourne, and we need therefore to build more dense environments. Density has all these fantastic benefits. It’s actually great for communities, it’s better for the environment, it reduces our footprint. It lowers the cost of infrastructure, it creates stronger communities.’

The suggestion that density particularly high-rise development is better for the environment is readily disputed in the report of Jago Dodson ‘The Carbon Devil in the Detail on Urban Density’

https://caanhousinginequalitywithaussieslockedout.com/2019/05/21/2011-the-carbon-devil-in-the-detail-on-urban-density/

AND No. 1 CO2 Emitter … CHINA

With the world’s largest population and for decades one of the fastest growing economies, China is far and away the world’s top CO2 emitter.

Xi having driven millions of Rural Chinese to be urbanised in high-rise precincts of cement, glass and steel emitting CO2 !!

https://www.usatoday.com/story/money/2019/07/14/china-us-countries-that-produce-the-most-co-2-emissions/39548763/

CAAN has shared numerous reports with you from the Unconventional Economist and others about how the cost of infrastructure has become prohibitively expensive with land buy-backs and tunnelling , and reports of isolation with higher density …

The housing density debate – will building more apartments make property cheaper?

Transcript

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GEOFF THOMPSON, REPORTER: Confronted by unaffordable house prices, more Australian families are embracing the high-rise life.

What do you think of property prices in Australia?

DIPDI JOSEPH: Crazy high.

ROMEL JOSEPH: Can we be very honest? Ridiculously high.

GEOFF THOMPSON: Dipdi and Romel Joseph chose an apartment in the northern Sydney suburb of Hornsby as their first home.

They’re new parents and new Australian citizens.

ROMEL JOSEPH: More and more people coming into Australia. They will start, definitely they will with the apartment because that’s more affordable.

We are used to living in apartments. So yeah, it serves the purpose.

We are suggesting our friends, and I’m sure if they come into an apartment, they’ll suggest other friends to come into an apartment.

BRIAN WHITE, JOINT CHAIRMAN, RAY WHITE GROUP: We’re finding more families in home units. Once that would have been unheard of. A home unit would be for adults, almost adults only.

Now families are living in units and obsession about big backyards is diminishing.

NICKI HUTLEY, PARTNER, DELOITTE ACCESS ECONOMICS: The population mix of Australia has changed dramatically and there are a lot of people who come here particularly from Asia who are used to apartment living, who are quite happy with that.

STEPHEN KOUKOULAS, ECONOMIST: In another year Australia is probably going to have another 400,000 people. They have to live somewhere and unless we’re building enough houses, they’re going to be pushing up rents and house prices with it.

GEOFF THOMPSON: Romel and Dipdi dream of owning a house here one day.

ROMEL JOSEPH: At the moment it’s definitely and comfortably a home for us.

GEOFF THOMPSON: And you hope it makes you some money so you can upgrade later?

ROMEL JOSEPH: Yes, definitely and we know for a fact that this apartment, the moment we bought it, it increased in value.

NICKI HUTLEY: Land is incredibly expense particularly in Sydney and Melbourne and we need therefore to build more dense environments.

Density has all these fantastic benefits and it’s actually great for communities. It is better for the environment. It reduces our footprint, it lowers the cost of infrastructure.

It creates stronger communities.

GEOFF THOMPSON: Rising out of the ground at Sydney’s Olympic Park, this looks like any other new apartment block.

Why is this development significant?

ADAM HIRST, MIRVAC BUILD TO RENT: In our view build-to-rent works all over the world and build-to-rent is something that Australia needs.

GEOFF THOMPSON: Let’s have a look inside.

Just as it sounds, build-to-rent is designed specifically for long-term tenants.

What’s a place like this rent for?

ADAM HIRST: One bedrooms will start from around $500, two bedrooms around $600 and three bedrooms around $850.

GEOFF THOMPSON: What makes living here different is you can choose the length of your lease.

PETER HARRIS, CHAIRMAN, PRODUCTIVITY COMMISSION (2013-18): It is common overseas.

We do see housing stock of this kind readily available, continental Europe and the US.

We just don’t see it here.

ADAM HIRST: The most important thing is maintaining occupancy and keeping our residents in here happy and for as long as possible.

GEOFF THOMPSON: The owners of build-to-rent developments are typically institutional investors, such as big super funds.

While it’s proven overseas, the future of build-to-rent in Australia is uncertain.

Mirvac is lobbying state and federal governments to change the way build-to-rent projects like this are taxed.

ADAM HIRST: Without some change from a government standpoint, this sector won’t reach the scale it needs and it will not take off as a viable option in Australia.

FELICITY EMMETT, ECONOMIST, ANZ: You know, that’s something that government policies can help support in terms of taxation arrangements as well and it is something various levels of government are going to have to look at more carefully so that we can supply affordable rental housing, particularly in the major cities and in the inner and middle rings.

GEOFF THOMPSON: So when does this finish?

CHRIS HARPUR: I think it has a year or two to go.

There’s a frustration to see how the suburb has developed and traffic around here is bad enough as it is. I know it’s not the only suburb but it is just not good.

GEOFF THOMPSON: It’s big, isn’t it?

CHRIS HARPUR: It’s huge. Wait till you see down the front.

GEOFF THOMPSON: Seventy-two-year-old Chris Harpur fears new apartment blocks will ruin his inner Sydney suburb of Alexandria.

CHRIS HARPUR: I’d like to see how the area goes where we’re living in Alexandria in the next 12 to 24 months.

There’s a lot of development which is encroaching.

BRENDAN COATES, GRATTAN INSTITUTE: The fundamental problem is that people don’t want more density in the suburb in which they live.

So it’s ultimately the politics of NIMBYism (Not In My Backyard) that is stopping us from building more housing, getting more density and ultimately allowing many Australians to pursue the Australian dream and have their own home.

GEOFF THOMPSON: Like many of his generation, Chris Harpur reaped the profits of the property boom.

His Alexandria terrace house has doubled in value since he bought it in 2008.

CHRIS HARPUR: I get the flak. If only it had happened, you people were lucky, you baby boomers and all that sort of stuff.

But gee, you know, I have worked quite hard in my life and I deserve to be able to do that.

Nobody knew that house values would go skyrocketing.

GEOFF THOMPSON: Chris was a self-funded retiree before the value of his shares was cut to pieces by the global financial crisis.

He now gets a part-pension while still owing $300,000 on his house.

CHRIS HARPUR: Having a mortgage in retirement was a bad decision. There’s absolutely no doubt about that.

There’s that old saying about being asset rich and cash poor, and I think that affects a hell of a lot of people.

GEOFF THOMPSON: Chris has decided to use the equity in his home to help fund his retirement.

He’s doing it with the newly expanded Pension Loan Scheme – a reverse mortgage backed by the Federal Government.

CHRIS HARPUR: I have more cash on a monthly basis. The money that comes from the Pension Loan Scheme quadruples.

My current cash flow is going to be amazing in the sense of having the flexibility with say the mortgage and stuff like that.

GEOFF THOMPSON: Chris won’t have to repay the government loan until his house is sold.

CHRIS HARPUR: I wouldn’t recommend it to people who didn’t have sufficient equity because you could chew it up very quickly as well and end up with basically having to sell the home anyway.

BRENDAN COATES: The Pension Loan Scheme is actually one of the best policy initiatives I think we’ve seen from government in the last 15 years because there is a clear need to get older Australians to use the equity in their home to have a higher retirement income.

We can’t continue to have such a large asset as housing sitting on retirees balance sheets and then not touch it at all to help fund their retirement and ultimately give them a better retirement than the one they could otherwise have.

GEOFF THOMPSON: Not all baby boomers cashed in on Australia’s property bonanza.

Some, like Belinda Webster, have had little choice but to rent most of their lives.

BELINDA WEBSTER: Rents are so expensive almost everywhere. I mean, I know Sydney rents pretty well. There’s no way I could afford to live in Sydney anymore.

GEOFF THOMPSON: Belinda was an award-winning record producer but it was never a lucrative career.

BELINDA WEBSTER: If I defined success in my life as earning money, I would have failed miserably.

That was really a subsistence income. I mean I couldn’t even afford to go overseas let alone buy a house. It was just not even on the radar.

GEOFF THOMPSON: At 67, Belinda’s been on the age pension for two years now.

Only recently, when her father died, that she inherited enough money to buy her first home.

BELINDA WEBSTER: Look, I’ve envied people who have been able to buy their own houses, that’s for sure but it’s never been a possibility for me.

So it’s not something that I was kind of expecting to be able to do and here I am in my first house for the first time in my life.

GEOFF THOMPSON: Her house is a demountable she bought for $280,000.

BELINDA WEBSTER: I feel great about being here because it’s a nice small size. It’s in a really beautiful location.

It’s where I want to be in the world.

GEOFF THOMPSON: It costs Belinda another $100 a week to rent a space at caravan park in Kangaroo Valley, two hours’ drive south of Sydney.

BELINDA WEBSTER: The aged pension is not anything to be aiming for in life as your means of survival because rents are really expensive.

So if people are single, if they don’t have very good jobs that pay them a lot, or if they’re living on welfare, or on the pension, there’s just no way they could afford it.

So I’m actually surprised there aren’t a lot more homeless people around.

NICKI HUTLEY: What we need to do is have affordable shelter.

So whether that’s home ownership, whether that’s rental accommodation that is affordable and that is stable, something that Australia is well behind the eight-ball on, there are other solutions.

So I wouldn’t want to be, people to think home ownership is the only answer. We need to think about this as a much bigger picture.

GEOFF THOMPSON: The time has come to reshape the Australian dream of home ownership into one we can all believe in.

BRENDAN COATES: So three decades ago your chances of owning your own home were roughly the same whether you were wealthy or poor in Australia.

Fast forward to today and home ownership is really, really dependent upon your income.

Home ownership is crashing amongst the bottom 40 per cent by income and also amongst younger Australians and it does mean that increasingly your ability to own your own home depends as much on who your parents are as whatever endeavours that you go about in your own life.

FELICITY EMMETT: Do we want to become a society where owning your own home depends on who your mum and dad are?

And I think that is the way that things are going at the moment.

SOURCE FOR VIDEO: https://www.abc.net.au/7.30/the-housing-density-debate—will-building-more/11964096

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Sydney's Green Square will be the mostly densely populated place in Australia by 2030, with 22,000 people per square km.

Sydney’s Green Square will be the mostly densely populated place in Australia by 2030, with 22,000 people per square km.

Image: City of Sydney

Calls for Empty House Tax Review

An empty House Tax here in Australia could raise a comparable $40M in each State …

-to fund housing initiatives

-but that does not restore housing affordability for the incumbents locked out by foreign buyers

AND on the important level of ‘community well-being’ … this could be achieved through the restoration of housing affordability for incumbents by blocking the Proxy laundering the ‘hot money’ in Australia’s domestic housing market …

This in turn will stop the vacant land banking and vacant properties full stop.

Contrary to the Morrison Government in the lead-up to the May 2019 Election, Labor had a plan to stop property money laundering … it was going to implement the Second Tranche of the Anti-Money Laundering LEGISLATION … and reverse the Real Estate Gatekeepers exemption made by the Morrison Government in October 2018!

-that would have eliminated the Proxy, and the ‘hot money’

-and restored the home market for Australian First Home Buyers

MEANWHILE the Chinese developer lobby here in Australia are replicating their ‘ghost cities’ that fall apart … as reported by Serpentza …

RESIDENTIAL RENEE MCKEOWN WED 12 FEB 20

Calls for Empty House Tax Review

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There are calls for an empty home tax to be reviewed and enforced across Australia after Victoria raised $5.4 million from a possible $120 million last financial year.

There were more than 20,000 empty homes in Melbourne and that number could be even higher in Sydney and Brisbane according to research from Prosper Australia.

However Victoria was the only state to impose a vacant residential land tax at 1 per cent for properties left empty for more than six months in a year in Melbourne.

Australia’s housing market was deemed “severely unaffordable” and among the most expensive in the world, while rent and house prices also went up last year.

Prosper Australia director of research Karl Fitzgerald said there was a missed opportunity—although the tax was brought in, it was not properly enforced and investors were still choking the supply.

“Quite a few housing advocates are simmering with rage because we’ve seen such a dramatic rollback of housing supply,” Fitzgerald said.

“More and more people are having their finance approved but cant find property to buy.

“We found at a minimum 20,000 properties were vacant [in Melbourne] and use zero litres of water over a 12 month period. Yet only 900 people self reported [for the tax].

“The government needs to impose fines, there’s no real penalty for not declaring.

“There’s a whole pile of issues [around this tax] it only included inner and middle ring properties, so it primarily targets foreign investors who own empty apartments but ignores the big land banks. ”

*A similar tax was introduced in Vancouver, Canada where almost $40 million was raised to fund affordable housing initiatives and saw a reduction in empty properties.

The tax led to 22 per cent fewer vacant properties in 2018 compared to a year earlier and a 7 per cent increase in tenancy.

City of Vancouver mayor Kennedy Stewart said the main objective of the tax was to address housing affordability.

“For those who choose to keep their properties unoccupied, we appreciate their contributions to the funds that are supporting various, much-needed affordable housing initiatives across the city,” Stewart said.

“The main objective of Vancouver’s Empty Homes Tax is to influence property owners to put their empty properties on the rental market and the data shows that is happening.”

Prosper Australia director of research said more could be done in Australia, not just the inner Melbourne region.

“We have tried to get access to this [vacancy] data interstate and it hasn’t been easy,” Fitzgerald said.

“We are surprised the government hasn’t really been on the front foot if they were genuinely serious about addressing affordable homes.”

Related: Mortgage Stress Rises as Debt Soars for Older Australians#vacancy rate#Vancouver#Affordable Housing#vacant residential land tax

AUTHOR Renee McKeown

SOURCE: https://theurbandeveloper.com/articles/calls-for-empty-house-tax-review?fbclid=IwAR32bM9jZrrvkDHuqDPbNMqTdHCeSl4fO_5i_avcg6bHhDtBwb6pKsVz2dI

COVID-19 spreads to Aussie property

Photo: The Australian; Toorak, dubbed the “ghost mansion”, is being sold off market for $80m

IS a Pandemic what it takes to restore the property market for Australian First Home Buyers?

Will the Property Sector get their act together?

Even developers are closing the gates … cancelling launches and investment seminars for the target overseas market …

And even Scomo can’t prop up the mates market … with the Pandemic worsening …

BECAUSE many comments on Facebook are not readily visible we SHARE it with you here

From George Smilas

WOW, really? are we supposed to be devastated? ….devastating that the flow of wealthy international investors from China have stalled because of a real risk of a deadly infectious disease threatening our people here?

…Not buying up apartments built for the sole purpose of further increasing the riches of our ELITES?. I feel really sorry,…. But WHY you think? …Why are they cancelling investment seminars?

…Are there not other investors around the world aside from CHINA?…Or is it because there is no $$$$$$ to be made elsewhere other than CHINA?….I want to know.

Have we put our efforts all in one basket and relying on just CHINA? …. Is that the case?…I want to know…… I seem to remember this notion of affordable housing being bandied around….is this our chance to get our homeless into a HOME now?…..I want to know.

Otherwise, if not… Let’s shop around for another market for our illustrious high density precincts….SHOCK HORROR ….I’m sure there are others who are used to living this type of lifestyle. BANGLADESHIS perhaps?…….Why not?…open up our options?…….Oh… OHHH wait, they haven’t got the $$$$$$’s…..

Well, I say to the developer lobby groups and spruikers of residential trash….suck it up and realise all good things come to an end….diversify your market.

Shut down your spruiking trash seminars to Chinese only investors and avail your apartments for what they are worth to our domestic market….fill them up!!… and maybe …just maybe start building quality buildings that don’t fall apart.

😊

COVID-19 spreads to Aussie property

By David Llewellyn-Smith in Australian Property

February 13, 2020 | 37 comments

Via The Australian:

Story image for Developers are cancelling launches of new apartment blocks and investment seminars targeting offshore buyers as they confront a potential fall in sales due to the coronavirus outbreak. from The Australian

Developers are cancelling launches of new apartment blocks and investment seminars targeting offshore buyers as they confront a potential fall in sales due to the coronavirus outbreak.

The property industry had hoped the new year would be marked by a pick-up in demand. While local buyers are out in force, a predicted surge in offshore investors into the top end of the residential market has been delayed.

Measures to contain the spread of the coronavirus in China and travel restrictions are causing problems for agencies as buyers can’t get to Australia.

…Investorist founder Jon Ellis said sales volumes coming out of China would remain low.

“The whole industry is in a bit of a pickle,” Mr Ellis said. “No property developers are going over there and also no agencies.”

He expects investment in Australia will slow as Chinese outflows fall off globally but he predicted they could pick up again after the scare dissipates. “Once coronavirus settles down and is under control, I think people will look back to Australia and will see it as very favourable. But certainly for the next month or two, I would not expect to see many contracts coming out of China,” Mr Ellis.

*But when will that be, Mr Ellis? And if it comes too early, as the CCP appears to be planning for, what will the private reaction to travel as the virus spreads globally? As well, students won’t return now until mid-year enrolments.

Given we already have a meaty property construction bust underway this is poor timing:

I expect house prices to slow and construction to bust all year.

David Llewellyn-Smith

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

SOURCE: https://www.macrobusiness.com.au/2020/02/covid-19-spreads-to-aussie-property/

The coronavirus and subsequent ban on non-citizens travelling to Australia from China has left prestige vendors short of foreign buyers. Photo: Janie Barrett

Gittins … Blame Housing for Weak Economy

RBA governor Philip Lowe thinks mortgage-holders are using their money to pay down their house debts.

RBA governor Philip Lowe thinks mortgage-holders are using their money to pay down their house debts. CREDIT:AAP

What was achievable … the Great Australian Dream of Owning Your Own Home has become a nightmare with a Whole Cohort of Australians locked out!

SEARCH CAAN WEBSITE TO LEARN WHY!

-Proxy Buyers

-Real Estate Gatekeepers (RE Agents, Lawyers and Accountants) excluded from Anti-Money Laundering Laws

.Scomo Government exempted them in October 2018

Read more:

https://caanhousinginequalitywithaussieslockedout.com/2018/10/09/2665/

.foreign buyers lured by our domestic housing to gain a ‘Permanent Resident Visa’

.the huge competition for Australian Housing escalated house prices

Related Article: Ross Gittins: The Great Australian Dream is Keeping the Economy Weak

https://caanhousinginequalitywithaussieslockedout.com/2020/02/12/the-great-australian-dream-is-keeping-the-economy-weak/

AS long as the economy relies on mass immigration and the housing ponzi to juice growth via consumption and pushing the capacity envelope, productivity and growth will remain poor.

Tell others … start the conversation …

Gittins: Blame housing for weak economy

By Leith van Onselen in Australian EconomyAustralian Property

February 12, 2020 | 9 comments

Ross Gittins has blamed Australia’s record high mortgage debt for hamstringing the economy:

Do you worry about the enormous size of your mortgage? If you do, it seems you’re not the only one. And the way Reserve Bank governor Dr Philip Lowe sees it, people like you are the main reason consumer spending is so weak and the Reserve and the Morrison government are having so much trouble getting the economy moving.

Until the global financial crisis in 2008, we were used to an economy that, after allowing for inflation, grew by about 3 per cent a year.

The latest figures show it growing by barely more than half that. (This, of course, is before we feel the temporary effects of bushfires and the coronavirus.)

This explains why the Reserve cut its official interest rate three times last year, dropping it from a record low of 1.5 per cent to an even more amazing 0.75 per cent. Cutting interest rates is intended to encourage people to borrow and spend. So far, however, it’s shown little sign of working.

Similarly, the first stage of the massive tax cuts that were Scott Morrison’s key promise at last year’s election, a new tax break worth more than $1000 a year to middle-income-earners, was expected to give the economy a kick along once people started spending the much bigger tax refunds they got after the end of last financial year…

So, rather than increase their spending on goods and services, they cut it and used whatever spare money they could to pay down their mortgage…

Gittins isn’t wrong.

Australian households are carrying one of the highest debt loads in the world:

They have also experienced a prolonged period of stagnant income growth:

Instead of spending the extra disposable income from tax cuts and lower mortgage rates, households are instead cutting consumption and paying down debt.

This is reflected in falling mortgage and personal credit growth:

Rising housing equity injection:

Falling new car sales:

Weak retail sales:

Weak household consumption growth:

And a private sector that is in recession:

That’s the cyclical story.

But the more important structural story is that Australia’s housing obsession is one in a series of factors that has crushed multifactor productivity (the driver of living standards) and lowered the economy’s long-run growth potential, namely:

  • Crush-loading infrastructure via the immigration ponzi, thus diluting Australia’s capital stock and requiring expensive new infrastructure to be built that is less efficient than what was already in place;
  • Massive over-investment in unproductive capital via the housing bubble;
  • Massive mis-allocation into white elephant energy infrastructure;
  • Over-inflated land costs; and
  • Oligopolies and rent-seeking across almost all facets of the economy, thus destroying innovation, efficiency and good management.

In short, Australia’s economic structure is stuffed. And as long as the economy relies on mass immigration and the housing ponzi to juice growth via consumption and pushing the capacity envelope, productivity and growth will remain poor.

Leith Van Onselen

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

SOURCE: https://www.macrobusiness.com.au/2020/02/gittins-blame-housing-for-weak-economy/

Coronavirus outbreak having big impact on tourism, economy and budget

The Great Australian Dream is Keeping the Economy Weak

The Great Australian Dream is keeping the economy weak

Ross Gittins
Ross Gittins

Economics Editor February 12, 2020

View all comments

Do you worry about the enormous size of your mortgage? If you do, it seems you’re not the only one. And the way Reserve Bank governor Dr Philip Lowe sees it, people like you are the main reason consumer spending is so weak and the Reserve and the Morrison government are having so much trouble getting the economy moving.

Until the global financial crisis in 2008, we were used to an economy that, after allowing for inflation, grew by about 3 per cent a year. The latest figures show it growing by barely more than half that. (This, of course, is before we feel the temporary effects of bushfires and the coronavirus.)

This explains why the Reserve cut its official interest rate three times last year, dropping it from a record low of 1.5 per cent to an even more amazing 0.75 per cent. Cutting interest rates is intended to encourage people to borrow and spend. So far, however, it’s shown little sign of working.Play Video

Markets still trying to price-in Coronavirus risk

Play video2:44Coronavirus outbreak having big impact on tourism, economy and budget

The federal government has responded to the current situation on the Coronavirus, as well as a ministry reshuffle.

Similarly, the first stage of the massive tax cuts that were Scott Morrison’s key promise at last year’s election, a new tax break worth more than $1000 a year to middle-income-earners, was expected to give the economy a kick along once people started spending the much bigger tax refunds they got after the end of last financial year.Advertisement

Despite Treasurer Josh Frydenberg’s confident predictions, it didn’t happen. Why have the authorities had so little success at pushing the economy along? Why did real consumer spending per person actually fall in the year to September?

That’s what Lowe sought to explain to the House of Reps economics committee last Friday. His theory – which he backed up with statistical evidence – is that, the combination of weak growth in wages with falling house prices has really worried a lot of people with big mortgages.

RBA governor Philip Lowe thinks mortgage-holders are using their money to pay down their house debts.
RBA governor Philip Lowe thinks mortgage-holders are using their money to pay down their house debts.CREDIT:AAP

So, rather than increase their spending on goods and services, they cut it and used whatever spare money they could to pay down their mortgage.

In principle when interest rates fall, people with home loans now have more money to spend on other things. In practice, however, most people leave their monthly payments unchanged. The amount they’re paying above the bank’s newly reduced minimum payment comes straight off the principal they owe, thus further reducing (by a little) the interest they’re charged.

That’s pretty much standard behaviour for Australian home-buyers. But this time they’ve also avoided spending their tax refunds, leaving the money in their “offset account”. They may or may not decide to spend it later. But for as long as it’s sitting in the offset account it’s reducing their net mortgage debt and the interest they’re paying.

But get this: not content with those two moves, households have also decided to cut their consumer spending and so save a higher proportion of their income. It’s a safe bet that people with home loans have got that extra saving parked in their offset accounts.

Illustration: Simon Letch
Illustration: Simon LetchCREDIT:

Lowe makes the point that, when worried home-buyers take money sent their way to get them spending and use it to reduce their debt, this does bring forward the day when they feel confident enough to start spending again. That’s true, but very much second prize.

If people with mortgages are feeling anxious, that’s hardly surprising. By June last year, household debt reached a record 188 per cent of annual household disposable income, before falling a bit in the September quarter (see above). About half that debt was for owner-occupied housing and about a quarter for personal loans and credit cards, leaving about a quarter for housing investment debt.

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This is higher than in most rich countries, but that’s mainly because of our generous tax breaks for negatively geared property investors, a loophole most other, more sensible countries have closed.

But hang on. Those of us living in Melbourne or Sydney (but not elsewhere in Australia) know that, in response to the recent cuts in interest rates, people have resumed borrowing for housing, causing house prices to stop falling and start rising again.

Is this a good thing? Lowe can see advantages and disadvantages. On the plus side, rising house prices are likely to make people with big mortgages feel less uncomfortable and so get closer to the point where they allow their spending to grow. It also brings forward the day when the building of new homes stops falling and starts rising again.

On the negative side, is it really a great thing for house prices to take off every time interest rates come down? How’s that going to help our kids become home owners?

Lowe asks whether we benefit as a society from having very high housing prices relative to the level of our incomes. “There are things that we could do on the structural side . . . to have a lower level of housing prices relative to income.” They’re much lower across the United States, for instance, even though, by and large, the Americans’ interest rates have been lower than ours.

What are these “things on the structural side” we could be doing to make our housing more affordable? He didn’t say. But I think he was referring to more liberal council zoning regulations and to getting rid of the many tax concessions that favour home owners at the expense of would-be home owners, including negative gearing.

Ross Gittins is the Herald’s economic editor.

Ross Gittins

Ross Gittins is the Economics Editor of The Sydney Morning Herald.

SOURCE: https://www.theage.com.au/business/the-economy/the-great-australian-dream-is-keeping-the-economy-weak-20200211-p53zmq.html

Older Australians who own their home more than 20 times better off than those who rent, data shows

TRUE … but does this Report tell Australians any more other than what they have already heard or experience?

BECAUSE we could not find any reference to what has caused this frightening predicament for a Whole Cohort of Australians.

The EMPHASIS rather appears to be on the divide of the Boomer Generation having home security and younger generations denied access to home ownership …

7.30 perhaps has not talked to the ‘right people’?

AND a lot of those renting are women.

This is what happens when nothing is done about … what are the causes of this ‘Divide’!!


-proxy buyers

-money laundering in real estate

.why not investigate why the Morrison Government exempted the Real Estate Gatekeepers from the Anti-Money Laundering Laws in October 2018?

-the World-wide marketing of Australian housing particularly to China and Hong Kong

.until the CoronaVirus 50,000 Chinese were flying into Australia every week

-the lowest wages growth for more than 60 years

.join a Union; you can join independently of your workplace; fees are tax deductible

1.6 Million Visa Workers in Australia

.thus high youth unemployment and underemployment

.unemployment in Australia is 19.7% not a mere 5.2%

2.3 Million Visa holders in Australia at any point in time; many on Real Estate Tours and seeking a ‘Permanent Resident Visa’ with Medicare Benefits!

NOW TELL OTHERS … start the Conversation Australia!

Older Australians who own their home more than 20 times better off than those who rent, data shows

7.30 By Geoff Thompson and Alex McDonald

Updated Mon 10 February 2020

A group of adults stand around at a house auction.

PHOTO: Home ownership rates have fallen, particularly among people aged under 40. (ABC News: Jerry Rickard)

RELATED STORY: It’s not just location and size that homebuyers are looking for

RELATED STORY: Australia has escaped property bubbles without a crash twice, is it third time unlucky?

RELATED STORY: Prospective homebuyers warn others to ignore ‘for sale’ price tag

Exclusive Australian Bureau of Statistics data has revealed the staggering difference in wealth of older Australians in owner-occupied households compared to those that rent.

Key points:

  • Those who own property as they approach retirement are much better off than those of the same age who rent, ABS data shows
  • Rates of home ownership fell among every age group between 2011 and 2016
  • Economist Brendan Coates says if fewer Australians own their home “it will have enormous consequences for all aspects of Australian life”

In 2017-18, the ABS found that property-owning households — where at least one of the occupants was 65 and over — had a median net worth of $960,000.

Similar households that were still paying off a mortgage had a median net worth of $934,900.

In stark contrast, the median net worth of similar households that rent was just $40,800.

“People who are not in the housing market will find it more difficult over time,” ANZ economist Felicity Emmett told 7.30.

“I think we will see a situation where wealth inequality and particularly intergenerational inequality rises.”

Nicki Hutley, partner at Deloitte Access Economics, believes Australia is in danger of creating a separate class of Australians who will not reap the many benefits that come with home ownership.

“Are we allowing one class of Australians to build for their retirement more easily than another class of Australians? The answer to that is unequivocally yes,” she said.

Ms Hutley has warned that Australia is in the grip of a housing affordability crisis that will lock a growing number of people out of the property market.

Analysis provided to 7.30 by the Reserve Bank of Australia confirms rates of home ownership fell among every age group between 2011 and 2016.

Chart showing home ownership by age group.

PHOTO: The rate of home ownership dropped in every age group between 2011 and 2016. (ABC News)

CAAN: 2011 was when the NSW Liberal O’Farrell Government won the election and in 2012 introduced its Planning Law Changes for Higher Density … In 2013 the Liberal Coalition took control of the Australian Government and together with its high immigration and visa manipulation housing development and house prices escalated; that is why home ownership for Australians dropped!

“When house prices are growing strongly, you see a big drop-off in the number of people moving into home ownership,” Melbourne University professor Roger Wilkins said.

Saving a 20 per cent deposit for a house in any Australian capital city now takesnine years for a typical household, while a median-priced property in Sydney now costs more than eight times the average household income, according to CoreLogic.

That is despite the recent correction wiping almost 15 per cent from Sydney property values.

Nationally, property prices are rising again and are predicted to recoup their recent losses by May.

“What’s happening now is real, but it’s not sustainable,” Ms Hutley said.

“We can’t keep having our house prices rise to these sorts of levels.

“We certainly have a housing affordability crisis in Australia.”

‘We’re likely to see fewer Australians own their own home’

The Grattan Institute’s household finances program director Brendan Coates points to sharply declining rates of home ownership among younger Australians.

Housing rebound to roll on


One of Australia’s leading forecasters is tipping Australia’s property price rebound to continue through 2020 … unless the economy rolls over.

The number of homeowners aged 18 to 39 in Sydney and Melbourne has plummeted since 2002, picking up only slightly during the recent downturn.

In 2002, 34 per cent of 18 to 39-year-olds in Melbourne were home owners. By 2018 that figure had dropped to 22 per cent, according to the HILDA Survey.

“It’s hard to see that that’s anything other than worsening affordability that’s driving that trend,” Mr Coates said.

“It is a crisis where, over the course of the next couple of decades, we’re likely to see fewer and fewer Australians — particularly poorer Australians — own their own home, and that will have enormous consequences for all aspects of Australian life.”

Hoping to achieve what their parents never could

Trudie and Dominic Harris standing in a kitchen

PHOTO: Trudie and Dominic Harris are hoping to qualify for the new first home deposit scheme. (ABC News: Michael Atkin)

In a typical year, Dominic and Trudie Harris earn about $120,000 between them.

They are hoping to achieve what their parents never could — buying a property that their eight-year-old son Liam can call home.

But the odds are stacked against them. In the Queensland suburb of Newport, where they currently rent, it takes, on average, 11 years to save a 20 per cent deposit for a house.

“Thinking it’s another 11 years to save to get into the market is crazy,” Ms Harris said.

“I’ll be 52 and Liam will be a teenager,” Mr Harris said.

The couple hopes to cut the deposit to 5 per cent by being one of the 10,000 Australians to qualify for the Federal Government’s new first home deposit scheme.

“It would be nice to get a hand up, not a handout,” Mr Harris told 7.30.

“I think the 5 per cent is a lot more achievable than 20 per cent.”

Housing deposit scheme ‘won’t have much of an impact’

Economists who 7.30 spoke toquestioned whether the Government’s home deposit scheme would make housing more affordable.

Low-deposit loan ‘bandaid’


Housing market experts generally agree that supporting low-deposit loans for first home buyers is at best a “bandaid” fix for the deeper problem of housing affordability.

“I think the first home deposit scheme is another example of a policy that sounds good,” the Grattan Institute’s Mr Coates said.

“It ends up being a policy that really benefits vendors of the kinds of homes that are attractive to first-time buyers, and that’s exactly what we’ve seen with stamp duty concessions for first home buyers in Victoria, and with first-time buyers grants in the past.”

Deloitte Access Economics’ Ms Hutley likened the scheme to previously tried “bandaid measures” that had not made housing more affordable overall.

“What I’d see as the underlying solution for housing affordability is to build more houses in the places where people want to live,” she said.

CAAN: Stop Visa manipulation with Real Estate Tours and the lure of ‘Permanent Residency’ and Medicare benefits! That is what has cut Australians out of home ownership … why can’t we talk about this?

Time to restrict TOURISM to TOURISM with no Proxy Buying of Australian domestic housing through Real Estate Tours!

CAAN: Search our Website for more reports

Read more on housing affordability:

SOURCE: https://www.abc.net.au/news/2020-02-10/older-australians-who-own-home-more-than-20-times-better-off/11815006

LIKE CAAN ON FACEBOOK!

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DEBUNKING THE REAL ESTATE HOUSING AFFORDABILITY MYTHOLOGY … IT IS THE FAULT OF ‘THE BABY BOOMERS’

TELL others … they need to know … to cut through the RE SPIN!

DEBUNKING THE REAL ESTATE HOUSING AFFORDABILITY MYTHOLOGY …  IT IS THE FAULT OF ‘THE BABY BOOMERS’

We will go back a way … to the late 1990s during the term of the Howard Government when …

‘Middle Class’ Chinese people were lured by the prospect of investing in Australian homes and/or education to gain ‘Flexible Citizenship’ … following which in the early 2000s there was a Housing Boom in Australia!

The latter years of Mr Howard’s prime ministership delivered significant increase to net overseas migration as a proportion of the population.

By the time of the 2007 election, his government had doubled the permanent intake.

In both the 457 — temporary business visa — and overseas student categories, Mr Howard oversaw significant growth from the turn of the century.

https://caanhousinginequalitywithaussieslockedout.com/2019/05/30/11797/

Prime Minister John Howard gestures as he answers questions.

Photo: ABC

IMAGINE … the headline … ‘High-Rise Titan pulls off Property Sting’ … with the ‘Foreign Investment Review Board (FIRB) Ruling … 2008/09’

harry triguboff named in australia rich list

Photo: AFR Rich List: Top 10 Property Players; Harry Triguboff

Following the GFC … that allowed developers to sell 100% of ‘new homes’ to overseas buyersup from 50% particularly in China ….

Obviously seeking large numbers of High Net Worth buyers!

Lang Walker Australia rich list

Photo: Lang Walker, AFR; Rob Homer

In NSW the O’Farrell Government in 2012 introduced its Green Paper for high density with …

High-Rise Residential Apartment Precincts

It is readily seen how both the FIRB Ruling and the Green Paper are linked!

The NSW Community were spun the line ‘have your say’ and wrote thousands of submissions to be ignored!

Followed by the ‘White Paper’ and the NSW Planning Law Changes

For more than 12 years the Second Tranche of the Anti-Money Laundering Laws to be applied to the Real Estate Gatekeepers were shelved … that allowed the ‘Hot Money’ aka ‘Black Money’ to be awash in Australian Real Estate … a number of organisations have raised issue with this sadly to no avail … including Transparency International, and the Financial Action Task Force (the FATF)

Search CAAN Website to find out more!

https://www.transparency.org/whatwedo/publication/doors_wide_open_corruption_and_real_estate_in_four_key_markets

IN October 2018 in the lead-up to the May 2019 Federal Election the Morrison Government exempted (excluded) the Real Estate Gatekeepers (Real Estate Agents, Lawyers and Accountants) from the Anti-Money Laundering Laws (the second tranche) …

The Royal Institution of Chartered Surveyors is developing a global standard to combat bribery and corruption in the ...

READ MORE!

Real Estate Agents, Lawyers & Accountants avoid Money Laundering Laws = Keeping Australian FHBs locked out …

https://caanhousinginequalitywithaussieslockedout.com/2018/10/09/2665/

SINCE the May Election in 2019 from late 2019 to date there has been another Property Boom following a Big Fall!

-this allows the onshore Proxy to flourish

-home prices again escalate

-first home buyers are outbid at auctions or deals are done behind closed doors prior …

despite loan approvals Australian First Home Buyers continue to miss out

-what it has meant is that the CCP Diaspora is growing across Australia

-with their high net worth they are buying up residential property close to the CBD, in the most desirable locations

.buying up commercial property, and agricultural property

IS this not an almighty betrayal of the Australian People … with more businesses exchanging hands for CCP Buyers on a daily basis?

BACK TO ‘THE BABY BOOMERS’ 

Contrary to the suggestion ‘put about’ that it is Baby Boomers who own property investment portfolios, and are ‘Millionaire Home Owners’ this is what Fact Check found …

Fact Check: Negative gearing used most by higher income earners

FOR every taxpayer that negatively gears 9 others do not

-they pay more tax to subsidise the minority of negatively geared investors

ABC Fact Check has debunked the Coalition’s and property lobby’s incessant claim that negative gearing is used primarily by ‘ordinary mum and dad’ middle-income earners with taxable incomes below $80,000:

josh frydenberg's claim is misleading

https://caanhousinginequalitywithaussieslockedout.com/2018/11/16/4237/?fbclid=IwAR0CPLY3l0HpI48u_Cz0ocCZRDN8xdFdh8lwrKb_s4TijadR13SwAzqJjD8/

Australian Temporary Visa numbers surge past 2.3 Million

The Department of Home Affairs temporary visa statistics for the March quarter of 2019 have been released with the total number of temporary visas on issue ballooning past 2.3 million:

https://caanhousinginequalitywithaussieslockedout.com/2019/05/31/11824/

With many seeking both Australian Real Estate and a Permanent Resident Visa!

CANNOT find more up-to-date figures but based on the observation of those Boomers who own their own home there are many who, through divorce, illness, job loss or other misfortune have lost their home, and many elderly women are now homeless!

OTHERS who, so far, have managed to hang onto the ‘Family Home’ are doing so to provide their Children some security!

Photo: Domain

HOW can those small percentages compare to the high influx of foreign investment?

A typical Real Estate Agent response to aspiring First Home Buyers is that they should ‘cut their cloth’

‘Buy house and land packages with small lots, a suburb not right on the coast, part of a cheaper development, it’s not that they can’t afford but that they want all the bells and whistles.

In this market that attitude will keep them out of their own home forever!’

MEANWHILE the Real Estate Gatekeepers display no hesitation in negotiating with money launderers, despite the loss of our Sovereignty … and despite the warnings from Australia’s foremost strategic thinkers and expert analysts, and that of Transparency International, the FATF, the OECD and others!

AS more of Our Families due to flat wages, soaring house prices … a consequence of the property industry contrived incursion from the overseas buyer … that now one in four Australians are now living in a privately rented home.

Auctioneer Damien Cooley

Photo: Domain has been seeing boom-time bidding tactics again. Photo: Peter Rae

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WHY are homes under Major Flight Paths Selling for Millions?

THE HOUSING BOOM will have enormous consequences …

‘We are creating a separate class of Australians, and that is not a Society that I think most of us want to see’! View 7.30 Monday 10 February!

MAKE your objections to your local MPs … AND tell others!

Planes fly over Sydenham after taking off from Sydney airport where one the runways is about to undergo maintence work. Two residents who live George Street ( did not want to be indentified ) watch a plane travel over her home.

Demand has surged for homes in suburbs under major flight paths.

IT has been reported by Aidan Devine that the demand has surged for homes in suburbs under major flight paths some selling for more than $2 Million

IT beggars belief that First Home Buyers, even very many Boomers would be able, or willing to pay $2M for a house directly under major flight paths. Why would they? When home owners in these areas have complained for decades about the aircraft noise

WHY would they buy there when homes in more desirable areas … a little further out are priced at $1.5 M or less?

WHO are these buyers?

PERHAPS this coincides with the increased inquiries from Hong Kong and China?

Image may contain: 1 person, eyeglasses

THE Morrison Government in October 2018 exempted (excluded) the Real Estate Gatekeepers from the Anti-money Laundering Laws … facilitating those in Hong Kong fleeing from the unrest and CCP control, and the continuum of Chinese seeking Permanent Residency in Australia …

Read more:

https://caanhousinginequalitywithaussieslockedout.com/2020/02/08/owen-wilson-re-group-speaks-to-the-business-about-increased-inquiries-from-hk-and-china/?fbclid=IwAR2wAvJlayaTZPT1d7RUafPbBaqMS5vMdvZC9Bc8k28L1vabMUPZHl_yra4

SOME 6 months ago we learnt of a young professional couple who purchased their first home, a semi, in Sydney’s Inner West for less than $1M …

EXTRACT …

‘Demand has surged for homes in suburbs under major flight paths.

Houses directly underneath noisy flight paths have been selling for millions as rampant property price rises squeeze buyers out of Sydney’s inner ring suburbs.

The desperate buyers helped drive up prices by up to 20 per cent over the past three months in the suburb of Marrickville, which has consistently had the most complaints to council about air traffic noise. *

A dozen homes in Marrickville sold for over $2 million in the second half of 2019, with the highest price coming in at just under $3 million.

The popular suburb sits directly underneath Sydney Airport’s busy flight path “B” departing from Runway 34L, the usual take off point for heavy duty long haul jets such as the Airbus 380 and Boeing 777.

Prices also look set to boom in nearby St Peters, Petersham, Stanmore and Summer Hill, which also sit under the same flight path.Aerial view of a Qantas plane taking off from Sydney Airport, with houses in the background.

A pocket of inner west suburbs near Tempe sit under one of Sydney’s busiest flight paths.

Demand for listings in Stanmore and Petersham jumped nearly 30 per cent over the past six months, while there was a 50 per cent increase in Summer Hill, realestate.com.au data showed.

Are they either foreign buyers or developers/investors land-banking?

‘It comes as finance data published earlier this week revealed most NSW house hunters have been trying to get into the market for months without success: two in five given pre-approval for a loan were yet to actually buy something.

Realestate.com.au chief economist Nerida Conisbee said that buyers had to compromise if they wanted an affordable home.

This Marrickville HOUSE sold for nearly $3 million late last year.

This home on Edwin St in Tempe sold for $1.625 million.

FURTHER, Ms Conisbee said that …

-there are a lot of people cashed up; ready to buy but very little is listed

-pushing up prices and forcing buyers to consider suburbs with bigger drawbacks.

CAAN: Very little is listed locally, but what of sites like Juwai.com, and the REA Group and others listing overseas? And local developers making offers home owners cannot refuse?

“Some of these suburbs are very noisy, but they also offer houses on big blocks, which are the most popular housing type at the moment,” Ms Conisbee said.

PERHAPS ‘houses on big blocks are the most popular housing type at the moment’ because the large lots lend themselves to the Medium-Density Housing Code?

READ MORE:

Homes under major flight paths are selling for millions as buyers scramble to get backyards

Aidan Devine 08 FEB 2020

Demand has surged for homes in suburbs under major flight paths.

https://www.realestate.com.au/news/homes-under-major-flight-paths-are-selling-for-millions-as-buyers-scramble-to-get-backyards/?rsf=syn:news:nca:dt:spa

Aerial view of a Qantas plane taking off from Sydney Airport, with houses in the background.

There are no affordable houses left in Sydney or Melbourne

SINCE late 2019 there has been a reported increase in inquiries from Hong Kong and China’s buyers …

https://caanhousinginequalitywithaussieslockedout.com/2020/02/08/owen-wilson-re-group-speaks-to-the-business-about-increased-inquiries-from-hk-and-china/?fbclid=IwAR2wAvJlayaTZPT1d7RUafPbBaqMS5vMdvZC9Bc8k28L1vabMUPZHl_yra4

PERHAPS that is why there are no longer any affordable homes in Sydney or Melbourne … it’s a NUMBERS GAME!

50,000 people from China were flying into Australia every week … until they were stopped by the CoronaVirus!

BUT that will not stop them …. they can buy online! All REA GROUP Agents operate digitally …

IN the Year of the Rat … 2020 … more Australians will have insecure work, continue to work for low wages, and be locked out of the home market by the foreign intrusion into our housing market … facilitated by scummy government policies …

Foreign buyers can launder ‘hot money’ in our Real Estate with the Real Estate Gatekeepers excluded from anti-money laundering laws!

the exemption occurred in October 2018!

PLEASE SHARE … and/or COPY AND PASTE into an Email … chat with others to let them know … they need to be updated! WHY not question your local MPs about this??

There are no affordable houses left in Sydney or Melbourne

By Leith van Onselen in Australian Property

February 7, 2020 | 29 comments

CoreLogic has released alarming research showing that there are no affordable houses in either Sydney or Melbourne:

While the median property value provides a useful reference point for the ‘typical’ home value in an area, buyers on a tight budget might find it more practical to narrow down their property search by examining lower quartile values

The lower quartile (or the most affordable 25% or properties in a region) provides a better view of the market entry point, while the upper quartile (most expensive 25% of properties) gives an indication about premium values…

Sydney Australia’s most expensive housing market has a median house value of $994,300. However the lower quartile house value, at $697,370, provides an entry point to the market that is almost $300,000 lower than the median.

In some cases, such as the North Sydney & Hornsby subregion or the Eastern Suburbs, the difference between the median and lower quartile can be more than half a million dollars.

Across Sydney’s sub-regions, there are three areas with a lower quartile house value below $600,000. These are the Central Coast ($525,590), Outer South West ($564,730) and Outer West & Blue Mountains ($575,890).

Additionally, Sydney has the largest inter-quartile range (the difference between the upper and lower quartile) with the upper quartile 126% higher than the lower quartile, implying a significant level of diversity in housing values across the city.

Melbourne With a city-wide median house value of $798,670, Melbourne is Australia’s second most expensive capital city housing market (after Sydney). The lower quartile value for Melbourne houses, at $614,330, is $184,300 lower than the median. This provided an easier entry point for budget-constrained buyers. Three sub-regions of Melbourne have a lower quartile house value that is greater than one million dollars (Inner, Inner East and Inner South), and four regions have a lower quartile house value below $600,000: North West ($549,790), South East ($573,590), West ($524,820) and Mornington Peninsula ($580,130)…

The situation will obviously worsen as the ‘Big Australia’ mass immigration policy doubles the size of Sydney and Melbourne over the next half century, swelling their populations to around 10 million each:

Full report here.

Leith Van Onselen

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

SOURCE: https://www.macrobusiness.com.au/2020/02/there-are-no-affordable-houses-left-in-sydney-or-melbourne/

Planes fly over Sydenham after taking off from Sydney airport where one the runways is about to undergo maintence work. Two residents who live George Street ( did not want to be indentified ) watch a plane travel over her home.
Photo: Daily Telegraph: What has it come to when homes directly under the flight path in Marrickville are now selling for more than $2 Million?

Owen Wilson REA Group speaks to The Business about increased inquiries from HK and China

Owen Wilson speaks to The Business

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

View:

https://caanhousinginequalitywithaussieslockedout.com/2019/10/22/hong-kong-unrest-sees-residents-look-to-australian-property-safe-haven/

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??

The Business

Owen Wilson speaks to The Business

Updated 7 February 20202

Expires: Saturday 4 January

Share!

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

VIEW:

https://www.abc.net.au/news/programs/the-business/2020-02-07/owen-wilson-speaks-to-the-business/11945514

Sydney Harbourside property

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VIEW WEBSITE TO FIND MORE ABOUT TOPLACE, RALAN GROUP, CHERRYBROOK, CASTLE HILL AND MORE!

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