December 2011
Protected: Leading Australian property spuikers for 2011 exposed
December 27, 2011 by Editor · Leave a Comment
Standard & Poor’s warns provision of Eurozone £407.5bn in cheap loans does not improve bank credit ratings
December 24, 2011 by Editor · Leave a Comment
The European Central Bank’s (ECB) unprecedented provision of a €489bn (£407.5bn) in cheap loans will “buy valuable time” for eurozone banks but has not improved their credit outlook, a director of Standard & Poor’s (S&P) has warned.
Amid a fresh raft of poor eurozone economic data, Scott Bugie, head of S&P’s financial institutions division doused the key cause for pre-Christmas optimism. Although he agreed Wednesday’s long-term refinancing operation was a “big deal”, Mr Bugie told Reuters: “It is not solving the fundamental issues though… It’s kicking the can a long way down the road rather than just a little bit, but in the end it is still kicking the big old can down the road.”
He said the action did not “change the fundamental picture but it does buy valuable time”. He added: “The move in itself will not lead to any improvement in (banks’) credit ratings.” (more…)
Fitch cuts Asia 2012 growth outlook: no denying global financial decline
December 23, 2011 by Editor · Leave a Comment
Global ratings agency Fitch on Friday cut its 2012 growth outlook for Asia to 6.8 per cent from 7.4 per cent previously, citing the weak global economy.
For 2011, the region is seen growing at 7.1 per cent, it said in a statement.
The downgrade was also to reflect the impact of policy tightening measures in some of the region’s economies, notably China and India where taming high inflation has been a major government priority, Fitch said.
It expects China’s economy, the world’s second biggest, to grow 8.2 per cent next year instead of the 8.5 percent forecast in June, while it tipped India to expand 7.5 per cent in the year to March 2013, instead of 8.2 per cent previously estimated.
“The reduction partly reflects weakening in the outlook for the advanced economies since June,” Fitch said. (more…)
Property expert dismisses Australian housing shortage report as “spin”
December 23, 2011 by Editor · Leave a Comment
Property market analyst Michael Matusik has dismissed government forecasts that Australia is heading for a massive undersupply of housing over the next two decades, arguing that politics and “vested interests” are at play.
The National Housing Supply Council’s State of Supply Report for 2011 forecasts that at the current rate of new housing construction, Australia will have a shortfall of 640,000 dwellings by 2030.
According to the report, the gap between housing demand and supply increased by 28,200, (nearly 18%) to 186,800 housing units in the 12 months to the end of June 2010, with NSW and Queensland having the largest shortfalls of 73,700 and 61,900 homes respectively.
The Real Estate Institute of Australia, Housing Industry Association , Urban Taskforce Australia, Master Builders Australia and lobbying group Australians for Affordable Housing have all responded to the report by demanding government action to address the shortfall in housing.
But Matusik says the people who compiled the report have a “vested interest in finding an undersupply – they keep their posts”. (more…)
Australian buyers saving pennies and hurting property market
December 22, 2011 by Editor · Leave a Comment
Lack of buying activity from retirees and wealthy professionals, in particular, is exacerbating WA’s embattled residential property market, CBRE says.
Global economic volatility and weak consumer sentiment have caused the local property sector to suffer, with massive stock levels, declining prices and no immediate recovery in sight.
The latest Residential MarketView report from CBRE suggests retirees and wealthy professionals are increasingly less active in the Perth residential market.
CBRE director, valuations and advisory services, Michael Veletta said economic volatility has particularly affected retirees, with this sector of the community seeing superannuation benefits diminish. (more…)
New reality owing more than you own: 60,000 families in Australia in negative equity
December 22, 2011 by Editor · 1 Comment
Rising property values have been an article of faith in the housing market for a generation of Australians who borrowed big as real estate prices marched ever upward.
Now, though, some buyers are finding that their homes are worth less than the size of mortgages taken out to acquire the proverbial roof over their heads.
While the percentage of home owners with so-called negative equity remains tiny – about one in fifty of the 3 million households with mortgages – the number may well swell in 2012 if home prices extend their declines as some analysts expect. The emergence of a sector of the housing market ‘‘under water’’ on their mortgages may hurt an already fragile real estate market.
Any forced sales would obviously dent individual household wealth but further drops in home prices would deter investors from buying residential properties. Ben Phillips, principal research fellow at the National Centre for Social and Economic Modelling, helped prepare the analysis which pointed to 60,000 households nationwide with negative equity. “The prospect of negative returns will certainly detract from sentiment through 2012,” said NATSEM’s Mr Phillips. (more…)
Australia in the grip of unemployment crisis with 100,000 jobs set to be slashed after Christmas: not a recipe for property recovery
December 22, 2011 by Editor · Leave a Comment
AUSTRALIA is on the brink of an unemployment catastrophe, with up to 100,000 jobs set to be slashed in the months after Christmas.
But the news isn’t all bad, with economists suggesting the nation’s wobbly economy could drive the official cash rate as low as 3.5 per cent by the end of 2012, The Daily Telegraph reports.
Westpac chief economist Bill Evans, one of the few economists who correctly predicted a rate cut in November, said lead indicators pointed to a very weak employment growth next year.
“We would expect the unemployment rate to edge up to 5.75 over the next six months,” Mr Evans warned. (more…)
Dodgy real estate agency Blackburne Property Group fined for 50 counts of delays in lodging tenants’ bond
December 21, 2011 by Editor · Leave a Comment
Perth real estate agency, Blackburne Property Group Pty Ltd, has been fined $15,000 and ordered to pay Court costs of $272 in the Perth Magistrates Court for delays in lodging tenants’ bond money with the Bond Administrator.
On Friday 9 December 2011, the agency pleaded guilty to 51 charges of late lodgement of security bonds on four occasions between January 2010 and March 2011, which continued despite numerous warnings from Consumer Protection. The funds were held in an agency trust account which was not a tenancy bond trust account as defined in the Residential Tenancies Act. In some cases, the delays extended to more than two months. (more…)
Australian property spruikers who’s who of 2011 named
December 20, 2011 by Editor · 3 Comments
The property spruikers are at it again talking up the Aussie residential real estate market contrary to objective and factual market information.
Recently the Adelaide property market was booming and now the Brisbane market is predicted to grow by 10% in 2012. We always appreciate well researched analysis and well informed commentary. We enjoy reading articles that demonstrate objectivity and provide factual information. Articles that give the reader a true sense of what is occuring in the market place, so you can make well informed decisions.
However when we read articles that are subjective, false, misleading and deceptive our blood pressure rises. How do you know what to believe? How can you discern what information is accurate and reliable? (more…)
British Foreign Office draws up plans to rescue expats if Spain and Portugal are hit by financial meltdown in 2012
December 19, 2011 by Editor · Leave a Comment
Evacuation plans for British expats stranded in Spain and Portugal if their banking systems collapse are being drawn up by the Foreign Office.
The contingency plans are being put in place to help thousands of Britons if they were unable to get to their money in the event of a catastrophic banking collapse in two of the most vulnerable eurozone economies.
Around one million British expats live in Spain, particularly around Marbella and Malaga, and some 50,000 in Portugal.
The Foreign Office is concerned that those who have invested savings in their adopted countries would face losing their homes if banks called in loans and they were unable to access money.
Last week ratings agency Standard & Poor’s downgraded 10 Spanish banks, including Banco Popular. (more…)
HIA emphasise high transaction costs in moving home: selling costs 4% and buying costs 5% of property price
December 19, 2011 by Editor · Leave a Comment
The Housing Industry Association, the voice of Australia’s residential building industry, today released the summer edition of its National Outlook, Australia’s most comprehensive housing report card.
The summer Outlook confirms deteriorating conditions for the housing industry in the final quarter of 2011.
“There is an immediate requirement for direct, short term stimulus to new home building,” said HIA Chief Economist, Harley Dale. “This needs to occur within an over-arching, renewed focus on structural reform to reduce the disproportionately high, inefficient and inequitable cost of new housing.” (more…)
Pop Melbourne’s median house price drops 8.3% and some suburbs fall up to 25% over 1 year
December 18, 2011 by Editor · Leave a Comment
Coming to grips with Melbourne’s property market has been no easy task this year.
While vendors in some postcodes have been rewarded with quick and healthy sales, many others have struggled to find a buyer even after lowering their reserve.
There’s no doubt the market has been hit with a healthy dose of the blues in 2011.
But just how far prices have come back not only depends on who you ask, but over what period you base your price data on.
At its worst, Melbourne’s median house price has lost $50,000 this year after peaking at $601,000 last December – an 8.3 per cent drop. (more…)
APM Spruiking The Brisbane Market Claiming 10% Growth: All Hot Air and Lacking A Well Researched Reasoned Opinion
December 18, 2011 by Editor · Leave a Comment
The Brisbane property market has been the worst performer of the capital cities in the nation with the median house price taking a tumble of 7 per cent.
Australian Property Monitors released its annual State of the Market report this morning, which took stock of the performance of property markets in capital cities across the nation.
The report found Brisbane house prices took the biggest fall, though next year is looking very rosy with the potential of double digit growth. (more…)
Fitch Ratings Agency warns of debt downgrade to Italy, Spain, Ireland, Belgium, Slovenia and Cyprus: crisis deepens
December 17, 2011 by Editor · Leave a Comment
Spain and Italy were both told to brace for a debt downgrade after a leading rating agency concluded that a “comprehensive solution to the eurozone crisis is technically and politically beyond reach”.
The eurozone’s third- and fourth-biggest economies were warned by Fitch of a “near-term” downgrade, alongside Ireland, Belgium, Slovenia and Cyprus.
In a further blow, Belgium separately saw its credit rating downgraded two notches, to Aa3, by another leading agency, Moody’s.
It cited the “sustained deterioration” in funding conditions for eurozone countries with relatively high levels of public debt, like Belgium, and new risks stemming from the country’s troubled banking sector. (more…)
The economy, the Chinese property market & Jim Chanos
December 17, 2011 by Editor · Leave a Comment
As we approach the end of another year we should not be surprised by the economic turmoil in Europe, the ailing U.S. economy or the rumblings of a major slowdown in the Chinese property market. The signs that all was not well with the global economy have been raised on this humble site going back more than a year. Simply put, borrowing vast sums of money and splashing it around did not fix the global economic imbalances highlighted by the market meltdown in 2008.
So here we are near the end of 2011 and the most of the major developed economies have shifted from enthusiastically embracing economic stimulus as a way to fix their ailing economies to implementing programmes to slash government spending.
In Australia over the last few years the government has tossed money at everything from home insulation & i-Pod docking stations at community centres to building new school halls at schools that didn’t really need new school halls.
Now with the Chinese economy slowing and commodities prices coming off their records highs the government has also decided to jump on the austerity bandwagon and will cut spending in an effort to try and balance the budget. (even if this means raiding The Future Fund) (more…)
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