Friday, December 18, 2009



Need some inspiration for things to see and do with the kids this Christmas? Click here to check out these Christmas activities.

Our blog is updated every Tues and Thurs morning.
Contact us: +61 7 3817 6666
property@daviddeane.com.au


Saturday, December 12, 2009


Here's an interesting article on live streaming video for your Smart Phone.

A grubby local competitor of ours has been paying his staff to remove our signs at night! Incredibly they have to bring our stake back to their office to collect payment.


We take this very seriously, as it affects our clients, and will pay a REWARD of $5000 for photo evidence which leads to their criminal conviction and public exposure.

Friday, December 11, 2009


Santa is coming here today!!! If you're in the area, we'd love you to drop by and say hi., There'll be a sausage sizzle, face painting and loads of giveaways. Please join us at 412 Gympie Road, Strathpine.


Santa is coming here today!!!


If you're in the area, we'd love you to drop by and say hi., There'll be a sausage sizzle, face painting and loads of giveaways. Please join us at 412 Gympie Road, Strathpine.

Wednesday, December 2, 2009

Congratulations again DDA Team for becoming a FINALIST for the 2010 REIQ Medium Agency of the Year Award. This is an awesome achievement with a record number of nominations this year.

Tuesday, December 1, 2009

The champion team of Mark Rumsey/Cassy Turner are certainly on track after record settlements for November towards the utopian achievement of $30 million in residential house sales in one year.

WE SALUTE YOU.

Monday, November 30, 2009

House prices on the move to finish 2009

Australian House Prices Rise Strongly in October after Sluggish September
30 November 2009
RP Data – Rismark Home Value Index Release
Australian House Prices Rise Strongly in October after Sluggish September…
Australia’s growth in home values rebounded in the month of October increasing by 1.4 per cent after a relatively flat September. Based on the rpdata.com residential property database, which is the nation’s largest with over 226,000 sales in the first nine months of 2009 alone, Australia’s housing market bounced back strongly in the month of October after little growth in September.* According to the market-leading RP Data-Rismark National Capital City Hedonic Index—which is published by the RBA in the Statement on Monetary Policy—Australian home values rose by an indicative 1.4 per cent in the month of October after just 0.4 per cent growth in September.** Over the first ten months of 2009, Australian home values have now risen by 10 per cent following on from their 3.8 per cent peak-to-trough falls in 2008. According to rpdata.com’s Senior Research Analyst, Cameron Kusher, “the strong growth figures throughout October after a slowdown during September show that the market is very resilient and that the 25 basis point interest rate increase during the month has not immediately impacted market.” Rismark International Managing Director Christopher Joye said, “Although we forecast a resilient recovery in 2009, we have been surprised on the upside by the strength of conditions, which reflects Australia’s better-than-expected employment and growth outcomes. We project that as mortgage rates normalise capital growth rates will fall back to more subdued levels.” Cameron Kusher said the likeliness of further interest rate rises over the next 12 to 18 months is likely to result in more normal growth conditions over 2010.“As interest rates rise over the next 12 to 18 months more normal rates of growth are likely. The removal of the First Home Buyers Grant Boost and higher loan costs are will also result in greater pressure on the rental market,” he said. Christopher Joye commented, “According to our analysis of all home sales in Australia, which we have privately shared with the RBA, the median Australian home value is only four times average disposable household incomes. This is inconsistent with claims that Australian dwelling prices are 6-8 times household incomes. People forget that 40 per cent of the housing stock is not located in the capital cities.”“This data implies that Australian housing is not expensive by overseas standards, and also helps explain our internationally high rates of home ownership combined with very low mortgage default rates.” “One question exercising people’s minds is the impact of higher interest rates. The RBA has pointed out that when they cut mortgage rates by 40 per cent in the second half of 2008 most borrowers did not actually reduce their repayments. The RBA suggested that this means that borrowers should be able to absorb future rate hikes as mortgage costs normalise,” he said. When we divide the patented RP Data-Rismark Index up into the cheapest 20 per cent of suburbs ranked by price, the middle 60 per cent of suburbs, and the most expensive 20 per cent of suburbs (see chart), we see that contrary to popular belief the least expensive areas (+8.5 per cent) have significantly underperformed the luxury markets (+11.9 per cent) in the year-to-date. This reverses out the trend in 2008, when the cheapest areas fared the best while the luxury markets performed worst. In the month of October homes values rose in every single mainland capital city except Darwin (-0.5 per cent), which is unsurprising given it has already experienced 12.7 per cent growth in the year-to-date. Cameron Kusher commented, “Darwin has had a tremendous run over the last 18 to 24 months seemingly unaffected by the Global Financial Crisis. With values now similar to those recorded in Melbourne an eventual slowdown in growth was inevitable. From an investment perspective the city remains extremely attractive due to the impressive yields. Any slowdown in value growth is likely to have a further positive impact on yields.”The biggest story of 2009 has been the strong recovery in the Melbourne and Sydney housing markets. In the three months to end October, home values in Melbourne and Sydney have outperformed most other capitals rising by 4.5 per cent and 3.2 per cent, respectively (see attached summary tables for more). Over the year-to-date, Melbourne has been Australia’s best performing capital city, delivering capital gains of +14.9 per cent. Sydney is up by nearly 1 per cent per month with cumulative growth of 9.9 per cent. In the first 10 months of 2009, most of the other capital cities have performed strongly with Darwin (+12.7 per cent) leading the way, followed by Canberra (+11.0 per cent), Brisbane (+6.9 per cent), Perth (+6.1 per cent) and Adelaide (+4.6 per cent).The RP Data-Rismark National Home Value Index results show that in the month of October, detached houses (+1.5 per cent) have once again shaded units (+1.1 per cent).Over the three months to end October, house values (+3.3 per cent) have also outperformed units (+3.0 per cent). But in the year-to-date, units (+10.4 per cent) have generated slightly higher capital gains than houses (+9.8 per cent). Mr. Joye said that the greater rate of growth for units over the year is likely due to the fact that in the first half of the year there was strong unit demand driven by first time buyers.In the RBA’s October Board Minutes, the Bank noted:“[M]any households with home loans had not sought to lower their monthly payments when mortgage rates had fallen and had instead paid down their loan balances ahead of schedule. This would reduce the vulnerability of that part of the household sector to rising mortgage rates.”In a speech last week, the RBA’s Deputy Governor reiterated concerns that we have previously raised about international interpretations of house-price-to-income ratios. He commented:“International comparisons of the relativity between house prices and income have been the subject of considerable research over the years. One of the complications faced by people working on this topic is to ensure consistency in the data that underlie the comparisons. Do the figures relate to capital city prices, or the prices across the whole country? Do they cover all dwellings or just detached houses? Is income measured as average weekly earnings or average household income? It is not always possible to get entirely consistent data across countries, so we need to be careful in interpreting the results of these comparisons.”Based on RP Data-Rismark estimates, Australia’s national dwelling price-to-income ratio of 4x is a bit higher than the US metric of 3x, which is lower than most developed economy peers. Here the Deputy Governor of the RBA offered an explanation for the differences:“There are a couple of reasons why Australian households seem to be able to sustain a higher ratio of house prices to incomes. First, Australians seem to spend less of their income on non-housing consumption than is the case for US households, with a significant part of this difference explained by lower health costs in Australia. Australian households therefore have greater capacity to service housing loans. Second, the level of gearing in the United States housing market is noticeably higher than in Australia. This may reflect the fact that Australian households are more active in paying down their loans after buying a home, possibly because owner-occupied mortgage interest rates are not tax deductible here as they are in the United States. The faster pay-down of mortgage debt in Australia reduces the risk of borrowers subsequently getting into financial difficulty. Overall, the experience of the last few years suggests that the Australian household sector as a whole appears to have the financial capacity to sustain a relatively high ratio of housing prices to income.”On the subject of whether Australian housing is unduly expensive, the IMF commented in its October 2009 World Economic Outlook Report: “In the case of Australia, if the impact of long-term migration on housing demand is taken into account, the results do not produce evidence of a significant overvaluation of house prices.” The IMF also concludes that: “If past is prologue, these estimates suggest that…the [housing market] corrections in Australia and the United States are close to complete…” In a recent presentation to the Melbourne Institute Rismark’s CEO examined IMF’s estimates of changes in real house price-to-income ratios from 13 OECD countries including Australia over the period 1997 to end 2008. It is noteworthy that the more recent period arguably disadvantages Australia since home values here fell only modestly in 2008 whereas they suffered precipitous falls elsewhere. On the basis of this benchmark, changes in Australian housing costs over time have been demonstrably ‘middle-of-the-road’. More precisely, between 1997 and 2008 Australia’s house price-to-income growth was lower than the following peers:
The UK;
France;
Sweden;
Spain;
The Netherlands; and
Ireland.Australia’s house price-to-income growth between 1997 and 2008 was only slightly higher than that which was realised in Italy, New Zealand and Norway. (The two clear international laggards were Canada and the US.) *RP Data-Rismark’s previous “indicative” estimate for the month of September of +0.1 per cent has revised up to +0.39 per cent based on the latest data.** In any given month the indicative index results will usually represent around one third to one half of the total population of sales transactions that are executed in the residential property market. RP Data ultimately collects roughly 100 per cent of all property sales via its licence agreements with every State and Territory Government Valuer General and Land Titles Office. These dataEnds. Additional information – please contact Mitch Koper at RP Data on 0417 771 778 or Christopher Joye on 0414 980 264.
Key statistics, tables and graphs available in the PDF (663kb).

Tuesday, November 24, 2009

USA study tour

A team of key staff from our office has just returned from San Diego in america attending the annual NAR real estate conference, attended by 20,000 real estate agents.
NAR represents 1,200.000 real estate agents and runs over four days, with lectures, displays and a massive expo displayed the newest and innovative ideas in real estate. The opportunity to network and learn from a massive base is amazing. Yes we have some cutting edge ideas to use in our local market.
50% of the 1.2m members have earned nil income in 2009.
250,000 have left the industry.
Real estate discounters have fallen like flies, closing and leaving staff and clients high and dry.
The majority of sales are what they call 'short sales', where the seller owes much more than the mortgage. Houses have dropped in price by anything from 10-50%.
The banks own but have not officially reposed seven million more homes which the government is funding till Jan/Feb 2010. This represents almost every house in Australia.
Many workers have had a 50% drop in income in retail and hospitality, its tough.
Detroit a city previously of 3 million people has reduced to around 1m people, they are bulldozing homes by the thousands.
Las Vegas homes have dropped dramatically with mansions previously selling for $1.5-2m dollars now buyable for $5/600,000.
There are two trains of thought 1. It has bottomed and will climb out slowly over the next 5 years or 2. There is another tsunami to come of what size is anyones guess. What ever happens the US has some tough years ahead.
They think we are insane to contemplate global warming taxes via the Rudds ETS.

A few findings that may be of interest in Australia:
  • Petrol is half the price we are paying
  • Cigarettes are only $5 as aginst $15 here.
  • Clothing, food and drinks are very much cheaper (often 30% of our prices) regulalrly half the price. Its no doubt we are being screwed.
  • People have become very friendly and open.
  • Disneyland is more fantastic than ever.

Tuesday, November 3, 2009

November 2009 interest rate rise

Australians have been hit with the expected 0.25% interest rate rise today, following the Reserve Bank Board's Melbourne Cup meeting.Economists have been widely predicting the rate hikes, with some anticipating more hikes at the December and February meetings."Australian house prices are showing strength, especially in Sydney, Melbourne and Darwin, but September figures have shown that price growth is starting to head backwards in cities like Brisbane, Adelaide and Perth," says Domain.com.au blogger and property author Alex Brooks."The strength of Australia's housing market has been one of the many economic reasons that the RBA feels the need to hike rates.It's not great news for home owners, but it is good news for the economy which will hopefully offer mortgage holders greater job security and income growth."

Thursday, October 22, 2009

The team at David Deane Real Estate welcomes the opportunity to introduce the RER principals to our office today to meet our team and experience our community. Lets hope this becomes a great source of referral business between our community and theirs. Welcome to the Moreton Bay region.

Monday, August 31, 2009

Fantastic Achievement in August


The sales team has notched up another great sales month for August with 65 sales contracts and settlements, representing almost $22,000,000 in local sales.

Of particular note is Mark Rumsey's achievement with his personal best performance month ever, with 7 years in the local industry. After appointing Cassandra as his P.A., he has blitzed his previous best results for both sales and listings - $5,000,000 in individual house sales and 15 listings. David Deane said "this result is better than 90% of other offices overall achievements, let alone an individual salespeople." Cassandra is a perfect fit and the year ahead is well planned for enormous success. It is Mark's planning and attention to detail which stands him apart.

He has consistently rated as the No#1 performer locally out of 300 sales people, according to independant research company market tracker. In fact the entire sales team is rated in the top 10 of those 300 active salespeople.

We expect an enormous result for September as this is the end of the subsidised first home owners subsidy.

Monday, August 10, 2009

Ekka Show Holiday - We are open all ay Monday and on Wednesday during both the Pine Rivers and Brisbane City Show Holidays. Feel free to drop in - we're here if you need us.

Thursday, July 30, 2009

Property Management Champions

On top of the recent win for Australia's Best Property Management Team at the Real Estate Results Awards in Melbourne - another win?

The team has posted their PB with record figures, record rents and hundreds of delighted owners.
David Deane said " without doubt the property management team is working extremely well together, their service is so good that the sky is the limit and they deserve the accolades".

Houses for sale -winners


The sales team at DDA have been been awarded the winner of "Most Sales Per Agent" at the Australian result awards.
"The competition was stiff with some of the best agents from across Australia and NZ in the mix. This included several NSW Agents of the year, including this years Victorian super offices and some elite offices from WA. The class of the agents included BRW winners" said Michael Sheargold-Results CEO.

David Deane said his team was working more effectively and harder than ever before. The exciting thing for us is that this award comes on top of the recent People Choice award, Business Achievers Best Real Estate Office. The team have won this for many years including this year.

Although you can't eat awards it is certainly a pointer to a very good group of people.

Tuesday, June 30, 2009

Brisbane

Brisbane home values remain slightly in the red on an annual basis, with home values -0.5 per cent lower in May than the same time last year. Over the first five months of 2009 Brisbane has begun to once again show positive growth. During the first five months of the year house values increased 1.6 per cent whilst unit values fell by -0.3 per cent despite the fact Brisbane is home to mainland Australia’s most affordable unit market. Rental returns for houses have softened slightly and currently sit at 4.6 per cent whilst unit rental yields continue to improve and are now recorded at 5.5 per cent.

Friday, June 12, 2009

Life wisdon from Bill Gates

Love him or hate him, he sure hits the nail on the head with this! Bill Gates recently gave a speech at a High School about 11 things they did not and will not learn in school. He talks about how feel-good,politically correct teachings created a generation of kids with no concept of reality and how this concept set them up for failure in the real world..


Rule 1: Life is not fair - get used to it!

Rule 2 : The world won't care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.

Rule 3 : You will NOT make $60,000 a year right out of high school. You won't be a vice-president with a car phone until you earn both.

Rule 4 : If you think your teacher is tough, wait till you get a boss.

Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.

Rule 6: If you mess up, it's not your parents' fault, so don't whine about your mistakes, learn from them.

Rule 7: Before you were born, your parents weren't as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent's generation, try delousing the closet in your own room.

Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they'll give you as MANY TIMES as you want to get the right answer. This doesn't bear the slightest resemblance to ANYTHING in real life.

Rule 9: Life is not divided into semesters. You don't get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time..

Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.

Rule 11: Be nice to nerds. Chances are you'll end up working for one.

If you agree, pass it on.
If you can read this - Thank a teacher!

Most of all Thank A Veteran for keeping our country free so this can be passed on to someone else.

HOUSING JUMPS ON OPTIMISM

Consumer sentiment; Housing finance
• The consumer sentiment index has surged out of recession territory. The index rose by 12.7 per cent – the biggest monthly surge in 22 years. The index is now at 17 month highs.
• The number of new housing loans is at 14-month highs, lifting by 0.9 per cent in April. Loans for new construction rose by 1.3 per cent to stand at 5,641 – a seven year high.
• First home-buyers account for over 28 per cent of home loans taken out – the highest on record. Banks account for over 92 per cent of all loans – a 33-year high. The average loan stood at $264,700, up 11.9 per cent on a year ago.
What does it all mean?
• The sharp pick up in business confidence recorded yesterday has been mirrored in the latest consumer sentiment survey. A combination of a firmer sharemarket, super-low interest rates, a stronger Aussie dollar and most importantly, the news of Australia avoiding recession has lifted consumer spirits. For the first time in 17 months there are now more consumers who are optimistic about the future than pessimistic.
• Consumer sentiment has remained in recession territory for over a year, however consistent with the no recession story, sentiment levels have once again reached more optimistic levels. The monthly increase in sentiment was the biggest in 22 years, as confirmation that Australia had avoided a technical recession lifted sprits considerably. It all comes back to job security and if consumers start feeling that employment prospects are holding up relatively well in the current environment, optimism will follow.
• For most consumers the strength of the Australian dollar tends to signify the strength of the economy. The rally in the Aussie over the last few months will make overseas holidays and imports cheaper. Interestingly amongst respondents the “News Heard Index” on the Australian jumped from 32.9 in March to 135.4 in June.
• The latest round of housing finance figures has reinforced our view that the housing sector will be the growth driver over the next year. Overall, the total number of new housing loans is at the best levels in 14 months. A sustained improvement in activity, a significant increase in loan size and importantly a substantial jump in construction of new dwellings are all encouraging signs that rate cuts and government stimulus are working their magic.
• Government forecasts suggest domestic economic activity will remain relatively soft over the next year however we expect the pick up in housing activity will go along way to supporting growth. New construction loans have risen by a further 1.3 per cent in April following the 13.7 per cent surge in March, and are now at the highest levels in over seven years. The knock on effects to housing-related retailers can already be seen with sales of furniture, floor coverings and tiles at the best levels in over seven years.
• Prospective home-buyers are certainly finding the current conditions quite attractive and first home-buyers are taking advantage of the government’s additional boost. Over the last six months over 87,000 properties have been purchased by first home buyers – the best result in records going back 17 years.
• The concerted efforts by the government and the Reserve Bank to stimulate the economy are having the desired effect. Job security remains the one major concern for budding home buyers. If employment manages to hold up relatively well in coming months, demand for homes should gain significant momentum.
What do the figures show?
• Housing finance: The number of new owner-occupier housing loans rose for the seventh straight month in April, lifting by 0.9 per cent. The number of home loans (60,395) is at 14-month highs.
• Construction loans rose by 1.3 per cent, while the purchase of newly erected dwellings fell by 0.5 per cent. The number of new construction loans (5,641) is at seven year highs. Loans for the purchase of established dwellings rose by 0.9 per cent while refinancing rose by 0.3 per cent.
• The value of new housing commitments (owner occupier and investment) rose by 3.6 per cent in April to $21.5 billion. Investment loans rose by 8.9 per cent while owner-occupier loans rose by 1.9 per cent.
• First home buyers accounted for 28 per cent of all lending in April – the highest proportion on record (almost 18 years).
• The average loan stood at $264,700, up 11.9 per cent on a year ago. The average loan by first home-buyers fell by 0.8 per cent in April to $283,400 and stands 19.5 per cent higher than a year ago.
• Banks financed 92.3 per cent of all home loans (by value) in April – holding near 33 year highs.
• The index of consumer sentiment rose by 8.5 points or 12.7 per cent to 100.1 in June. The sentiment index is now up 18.2 per cent on a year earlier.
• The current conditions index rose by 2.2 per cent, while the expectations index surged by 20.7 per cent.
• Four out of the five components of the index rose in June.
• The estimate of family finances compared with a year ago rose by 8.1 per cent while the estimate of family finances over the next year gained by 11.1 per cent. Economic conditions over the next 12 months rose by 37 per cent while the measure of economic conditions over the next 5 years rose by 20.2 per cent
• The measure on whether it was a good time to buy a major household item fell by 1.6 per cent.
• Survey respondents believe that the wisest place to put any extra savings at present is in bank deposits (27.1 per cent of respondents), followed by paying off loans (23.2 per cent), real estate (16.1 per cent) and shares (12.3 per cent).
• The measure of wether it is a good time to buy a dwelling rose by 2.5 per cent to eight year highs, while the index of whether it is a good time to buy a car rose by 8.7 per cent.
What is the importance of the economic data?
• Housing Finance data is produced monthly by the Bureau of Statistics and shows commitments by lenders, such as banks, to provide finance for housing purposes. The lending figures relate to those looking to buy or build homes to live in as well as those seeking to buy or build homes for investment purposes. Generally people get their finance organised first, so the figures are regarded as a leading indicator on the housing market.
• Westpac and the Melbourne Institute release the Index of Consumer Sentiment each month. Roy Morgan conducts a survey of consumer confidence. Both surveys are aggregated from responses to questions on the current and likely future state of family finances, current and likely future state of the economy and whether it is a good time to buy a major household item. Confident consumers may be more inclined to spend, especially on major items.
What are the implications for interest rates and investors?
• The likelihood of further rate cuts is fast being eroded. A sustained improvement in housing activity and stability in global economic conditions is likely to see the Reserve Bank remain on the interest rate sidelines in the near term.
• Investors should think long and hard about property investments. Rents are rising at double-digit rates, construction is not yet keeping pace with population (although latest signs are encouraging), interest rates are low and home prices are rising.

Source Savanth Sebastian - Economist, CommSec

Tuesday, June 2, 2009

RBA HOLDS RATES + OUTLOOK

RBA stays put

Update The Reserve Bank held interest rates steady for a second month in a row, arguing that emerging signs of a recovery averted the need for an additional cut.

The key cash rate remains at a 49-year low of 3 per cent. The central bank had lopped 425 basis points from the official rate between last September and April in a bid to keep the economy expanding through a global downturn.

For a range of tools to help you calculate your home loan, click here.


Rates stay the same, for now...
Business Day reporter Chris Zappone sees signs of rate rises in the next year.
''Evidence has continued to emerge that the global economy is stabilising, after a sharp contraction during the December and March quarters,'' RBA Governor Glenn Stevens said in a statement.

''The considerable economic policy stimulus in train in most countries is helping to contain the downturn, and should support an eventual recovery,'' Mr Stevens said.

The federal government has pumped more than $50 billion into the economy in the last half year and earmarked record investments - and record deficits - to compensate for an expected slump in business spending.

''It is very important that fiscal and monetary policy is working together to stimulate our economy, to support vital employment in the economy, to support the business community and to support the rural community,'' Treasurer Wayne Swan told reporters.

The Australian dollar retreated after the RBA announcement, buying 80.55 US cents, or down about half a US cent. Stocks held on to their gains of about 1.6 per cent for the day, closing at their highest for 2009.

Rates outlook

Today's RBA statement convinced some economists that the RBA's series of rate cuts is over, with a rate rise becoming a possibility before the year is out.

Macquarie interest rate strategist Rory Robertson noted the RBA's readiness to cut interest rates again ''if needed.''

''The story that's been emerging in the last few weeks is that low rates are promoting growth. Home construction and home prices are turning higher, showing that policy is working,'' he said.

"So, the RBA is on hold for the foreseeable future, and we're less sure that there will be any further rate cuts at all."

ICAP's chief economist Adam Carr is penciling in a rate rise.

''I don't think they will ease again, given the domestic and global economy recovery. I think rates will be on hold until the end of the year with a potential for a rate hike by December."

Each-way bet

Moody's Economy.com's Matt Robinson said the RBA's accompanying statement ''starts off very bold, with confident statements about a turnaround evident in global economy, particularly China and the emerging markets'' but that upbeat view is set against a readiness to reduce rates again.

The RBA seems to be ''confident enough of an eventual recovery that interest rates aren't going to be eased further,'' he said. ''At the same time it's sending a clear signal to markets that have been pricing in optimism about growth, in particular through higher long-term yields,'' that the RBA remains ready to cut again.

''This is the RBA's implied way of saying the market is getting ahead itself (with expectations of higher rates) and there is little chance of a rate rise any time soon,'' Mr Robinson said.

In recent weeks, the market has been pricing in the possibility of an interest rate within 12 months, according to data from Credit Suisse. Today, the market expectation rose to a full 25 basis points increase by next June, underscoring hopes of a recovery

Friday, May 29, 2009

HOME PRICES SURGE

Monthly house prices
• New data shows that home prices have surged in the first four months of 2009. The RP Data-Rismark Hedonic Australian Home Value Index – the largest property database in Australia – rose by 2.8 per cent in just the first four months of 2009.
• Darwin has led the way over the first four months of 2009, up 5.3 per cent with Melbourne home prices up 4.5 per cent, and Sydney prices up 3.9 per cent. Prices rose in all capital cities except Perth.
What does it all mean?
• Home prices are again rising across Australia – in fact they began rising in January and have been picking up steam ever since. A combination of generational-low interest rates, tight rental markets, the expanded first homebuyers grant and soggy sharemarkets have caused more buyers and investors to turn their attention to the property market.
• Australia has been called the ‘wonder from down under’ because our home prices are not falling at 20 per cent annual rates like in the US and UK. However the situation is far from remarkable. Population is rising at the fastest rate in 40 years, interest rates are super-low and we have a very tight rental market. It is simple demand and supply – demand is outstripping the supply of homes, putting upward pressure on prices.
• The result on home prices is heartening for the Reserve Bank, Federal Government and all Australians. Modest gains in home prices boost consumer confidence, wealth and spending levels. And if confidence and spending levels lift, this will in turn boost employment and ensure that the flat spot experienced by the economy proves brief.
• CommSec believes that the fears about future job losses have been overdone with businesses cutting hours and salaries rather than jobs. With unemployment likely to only creep higher, the rally in home prices won’t be derailed. In fact the experience from the last recession shows that home prices can lift as unemployment rises.
• The RP Data-Rismark index has emerged as Australia’s authoritative source on home price trends. The property database is Australia’s largest and, unlike the Bureau of Statistics, all properties are counted, not just free-standing homes.
What do the figures show?
• The RP Data-Rismark Hedonic Australian Home Value Index rose by 1.0 per cent in April after lifting 0.6 per cent in March, 1.0 per cent in February and 0.1 per cent in January.
• Over the first four months of 2009 capital city home prices rose by 2.8 per cent. Over the year to April home prices were unchanged.
• Units have outperformed free-standing houses in the first four months of 2009. Unit values increased by 3.3 per cent in the period while house values rose by 2.7 per cent.
• The “final” March quarter RP Data-Rismark Hedonic Australian Home Value Index result was revised up from +1.6 per cent to +1.8 per cent.
• Darwin was the strongest of all capital cities with home prices up 5.3 per cent in the first four months of the year. Melbourne prices rose 4.5 per cent followed by Sydney (up 3.9 per cent), Brisbane (+1.6 per cent), Canberra (+1.1 per cent) and Adelaide (+0.7 per cent). Perth prices fell 0.8 per cent over the period after stellar gains in recent years.
• RP Data-Rismark calculates the median capital city house value across Australia at $489,748 with the median unit value being $398,599.
What is the importance of the economic data?
• The RP Data-Rismark Hedonic Australian Home Value Index is based on Australia’s biggest property database covering 60,000 Unlike the ABS Index, which excludes terraces, semi-detached homes and apartments, the RP Data-Rismark Hedonic Index includes all properties
• The monthly RP Data-Rismark Hedonic Index compares month-to-month index results. Accordingly, the first quarter of 2009 index results compare the end of March index with the end of December index.
• Rising house prices serves to lift consumer confidence and wealth levels. However rapid increases in home prices decreases housing affordability.
What are the implications for interest rates and investors?
• The latest data on home prices confirms our view that interest rates have all but bottomed. While there is still an outside risk that the Reserve Bank will cut rates again, the chances of a rate cut are growing smaller as each day passes.
• The lift in home prices should encourage more investors to enter the property market, potentially restraining the rally on the sharemarket.
• The Reserve Bank will need to be mindful of the 1987 situation where investors and buyers directed their attentions away from the sharemarket to property, sending property prices soaring.
• The lift in home prices is positive for consumer spending, buoying prospects for retailers as well as builders and developers.

FIRST HOME OWNERS GRANT

Mixed response for grant reprieve
For the property market, the most important revelation to come out of the federal budget was that first-home buyers will get some reprieve with the boost to the first-home buyers grant being extended to the end of September.After this the boost will be halved, providing a $10,500 bonus to first-timers buying an existing dwelling, or $14,000 for those buying a new home.

This decision is sure to be met with a mixed response. Many people have been vocal in their disapproval of the grant, suggesting the incentive has brought forward demand from first-home buyers and artificially inflated prices in our mortgage belts.

On the flipside, the argument is that demand from first buyers has been relatively flat since 2004. As interest rates dived, house values fell and the Government provided a boost to the grant. Pent-up demand was released, resulting in the flurry of activity we now see. For many of these affordable areas the recent price growth is simply offsetting the falls in housing prices that many recorded between 2004 and 2009.

I expected the Government to maintain the $21,000 boost for new dwellings and wind back the grant for existing dwellings to $7000. The logic for this is it makes sense to focus the greatest stimulus on areas of the housing market that will provide the greatest benefit to the economy. A focus on stimulating new dwelling sales would also help alleviate our chronic housing undersupply.

Another budget announcement likely to affect the property market is the $22billion allocated to infrastructure spending. The key benefactors will be regions along the eastern seaboard, particularly south-east Queensland.

Yet perhaps the most immediate requirement is to establish links between the outer fringes of our metro areas where the large proportion of our population growth is concentrated. Many of these regions are in desperate need of transport infrastructure improvements and public transport options. This is where the most affordable land is, yet few want to live where travel routes are congested or are substandard.

Friday, May 22, 2009

OPEN FOR INSPECTION - Saturday 23rd May

This is your opportunity to check out two great properties that are Open for Inspection for you this Saturday..

11 MOHR COURT, PETRIE
Open House: 10:00 to 10:45

25 LIDO COURT, WARNER
Open House: 11:00 to 11:45

For more information, please contact our Team on (07) 3817 6666.

We'd love to see you there.

Thursday, May 21, 2009

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