Western Australia property sales dips 30 percent

Prices for property in Western Australia have dipped by 30 percent based on information released by the Real Estate Institute of WA.

Now is the best time to buy property in the area. In Perth alone, there is a 40 percent oversupply of property, forcing sellers to either agree to a lower price or wait when prices have gone up. The Real Estate Institute deputy president David Airey said in Perth:”There’s around 17,500 residential properties on the market which is somewhere like 5,000 properties more than our normal long term average.”

“It’s a fabulous time to buy, certainly not a good time to be selling if you don’t have a reason to sell.”

Perth suburb, Peppermint Grove, is now the most expensive area in the region with average prices rising by as much as 95 percent according to the Australian Bureau of Statistics data compiled from 2008 to 2009 and compared to 2004 to 2005 figures. Currently, an average house in Peppermint Grove is priced close to US$4.5 million.

The data is affected by the presence of a number of high-priced sales. “With sales as there have been in that area for $9/10/11 million in the last year or 18 months it’s thrown this huge curve up,” Airey added. Following Perth, Mosman Park suburb has the highest average property value which increased to 210 percent to US$1.5 million. The suburb is situated along Stirling Highway with Perth 14 kilometers away.

Source: http://au.ibtimes.com

Tags: investing, news, property, real estate, research

Posted in News, Research

Premier John Brumby concedes defeat in Victorian election

BrumbyALMOST 48 hours after polls closed in the Victorian election, Premier John Brumby has conceded defeat.

"The reason I am here today is that I have just spoken to Ted Baillieu and have congratulated him on his election victory," Mr Brumby said.

"I had a long conversation, a positive conversation, and I wished him every success.

"I have told him what a great honour it is to be premier of this state and wished him every success as he governs in the interest of all Victorians."

But he was also bullish about Labor’s achievement in government.

"There is no doubt we leave Victoria a stronger, better and fairer place than we found it 11 years ago."

He thanked his staff and supporters.

After 11 years in power, Labor suffered a backlash in the eastern and southeastern suburbs at Saturday’s poll, with a swing of around 6.5 per cent against the Government.

The Liberal-Nationals Coalition has secured 44 seats in the 88-seat lower house to Labor’s 43 and need 45 to form majority government.

The seat that hangs in the balance is Bentleigh, where the Coalition holds a 423 vote lead with around 3000 votes still to be counted.

While the Victorian Electoral Commission has indicated it is increasingly unlikely a result will be declared in Bentleigh today, Mr Brumby accepted the inevitable and conceded defeat.

Mr Baillieu, 47, will become Victoria’s 46th premier. He will visit the governor at 6.30pm (AEDT) to accept his invitation to form government.

Earlier today, Opposition Leader Ted Baillieu said that when Labor chose to concede defeat was a matter for the Premier and Victorians would judge him for it.

"The way he approaches it will be the way he is judged. What we are doing is getting on with the job of being ready to govern," he said.

"As I said on Saturday night, we are ready to govern, we want to make sure that we are in a position to do that in the event that we are asked to do so."

Mr Baillieu described the shadow cabinet meeting as long, productive and responsible. The Liberal leader said he and Nationals leader Peter Ryan were excited by the opportunities ahead but were not getting ahead of themselves.

‘Difficult for long-term governments’

Prime Minister Julia Gillard has batted away suggestions that Labor’s loss in the Victorian state election has implications for federal politics.

Ms Gillard described John Brumby as "a capable Premier" who had led Victoria "very ably".

She noted that Labor in Victoria had been asking for a further four years after being in office for 11 years.

"You don’t need to be too much of a student of political history to know that it is very difficult for long-term governments to present and have their mandate renewed," she said.

"I think that’s what we’ve seen happen in Victoria."

Ms Gillard said the Victorian election had been fought on state issues.

Source; www.news.com.au

Aussie Banks’ “Unique System To Keep Dwelling Prices High”

banksWell reader, I have to say it, today your editor read the most ridiculous article we’ve ever read on Australia’s now-popped house price bubble.

And believe me, that takes some doing.  There’s been a heck of a lot of rubbish written over the years, but the article we read today trumps the lot.

What makes it worse is that it wasn’t written by some half-baked real estate agent or a rabid property spruiker.  No, it was written by someone who many believe is one of the most respected financial journalists in Australia – Robert Gottliebsen.

As his biography on the Business Spectator website points out:

“When it comes to Australian business media, one name is synonymous with trust, integrity and depth of knowledge that surpasses all others, that name is Robert Gottliebsen.  Robert Gottliebsen is an Associate editor for Business Spectator and was the original AFR Chanticleer and founder of Business Review Weekly (BRW) Magazine.”

He’s a commentator that many in the mainstream respect.  Although based on the article he wrote yesterday, he looks to be past his sell-by date.

In his article Mr. Gottliebsen expressed sympathy for a view put forward by Bendigo and Adelaide Bank chairman Rob Johanson.  Mr. Johanson was commenting on proposals by the socialist Green Party to prevent Australia’s banks from raising rates any higher than rate moves by the Reserve Bank of Australia (RBA).

Mr. Johanson said:

“None of us… who can remember trying to buy a house in the 1970s would want to have to go through or go back to that situation for funding.

“With my wife I bought my first house in 1967 and I remember vividly what it was like in the 1970s.  Getting a housing loan from the bank was extremely difficult and as a result house prices were very low because you had to assemble deposits many times current requirements.”

Mr. Gottliebsen then offers his opinion on what makes the current Australian housing market so special:

“It might not be intentional, but in Australia banks have developed a unique system to keep dwelling prices high.  They are liberal in granting housing loans, so there is a strong consumer demand for houses.”

We’re dumbfounded, but we’ll continue:

“By restricting the supply and boosting the demand, banks keep dwelling prices high.  If the Greens’ proposal were enacted and we had further increases in the cost of funds overseas – which many are predicting – then the current high house price arrangement would be blown apart…

“I am delighted that neither the government nor opposition are going down that path.

At least we should be grateful for one thing from Mr. Gottliebsen’s truly mind-blowingly dumb article, and that’s the admission from a mainstream insider that the current housing and banking relationship would be “blown apart” if it wasn’t for house price manipulation by the banks and government.

But of course, it’s too late to worry about that.  As I wrote earlier this week, the house price bubble has already popped and it’ll be blown apart regardless of whether the Greens’ policy gets up or not.

But quite frankly we find it extraordinary that not only would a banking executive claim it was terrible that people had to “assemble deposits” to buy a house, but it’s equally bizarre that a so-called respected journalist would cheer the fact that Aussie banks have “a unique system to keep dwelling prices high.”

Clearly they prefer how the market is rigged right now.  Where those – we’ll assume – such as Mr. Johanson and Mr. Gottliebson who bought their homes in the 1960s and 1970s and who have benefited from two decades of loose bank lending and cheap credit feel weak at the knees at the thought of house prices returning back to their pre-boom levels.

Much better for house prices to remain high, for banks to be “liberal in granting housing loans”, and for current homebuyers to be paying 60% or 70% of their income in interest to the banks… banks such as Bendigo and Adelaide Bank.

I mean think about it.  Think about the difference.  In the 1960s or 1970s buyers would have saved a deposit.  They would have had money sitting in a bank account accumulating interest.

Importantly, they would have been debt free.  And, they would have had savings set aside for a rainy day or to put down as a deposit for a house.

Today, buyers are bribed and suckered in to the market by banks such as Bendigo and Adelaide Bank thanks to artificially low interest rates and taxpayer funded giveaways such as the first home buyers bribe.

And rather than having a healthy bank balance of savings for a rainy day or for a deposit, well, they’ve already got a house so they don’t need a deposit, and with 60% or 70% of their income going on mortgage repayments they don’t have a bean left to put towards savings anyway.

They’re living the life of a pauper, but at least they’re doing it in style… if that’s possible!

But don’t worry guys, because apparently in Australia “banks have developed a unique system to keep dwelling prices high.”

Don’t you believe it.  The market has cracked and the baby-boomers who thought they could profit at the expense of youngsters going deeply into debt will soon find the smile wiped off their faces.

Perhaps Gottliebsen’s name used to be synonymous with trust, integrity and depth of knowledge, but not after that article.  We thinks it’s time for Gottliebsen to hang his head in shame and hang up his boots to let someone with a bit of common sense take over.

Story by Kris Sayce http://www.moneymorning.com.au

Tags: banks, economy, finance, housing, loans, news, property, real estate, research, value

Big real estate trusts look to growth

HouseQuestionMarkMERGERS and acquisitions will dominate the real estate investment trust sector in the coming year, as the strong players get bigger at the expense of the smaller trusts, according to a report from the corporate advisory firm PKF.

This comes as investors in the ING Real Estate stable of trusts keenly await the conclusion of proposed takeovers and the internalisation of the industrial and office funds management.

The second annual REIT Monitor report, released yesterday by PKF Chartered Accountants and Business Advisers, shows there is an increasing divide between the so-called ”big eight” real estate trusts and their smaller counterparts.

In its big eight, the report includes trusts such as Stockland, Westfield, Mirvac and CFS Retail, and says they are now generally well placed to continue with expansion plans.

But for the smaller trusts, such as the Centro groups, the ING trusts and Multiplex Prime Property Fund, they are surviving predominantly at the discretion of their senior lenders. The PKF REIT Monitor report covers the 2010 financial year.

Ed Psaltis, the PKF corporate advisory partner, said it was obvious a large gap exists between the big eight and their counterparts when considering gearing levels.

“Over the 2010 financial year, the majority of REITs [63 per cent] were successful in decreasing their gearing levels mainly by paying down debt,” Mr Psaltis said.

”But the number of REITs continuing to trade at heavy discounts could see merger and acquisition activity increase as the strong take over the struggling. Funding for takeovers was finally now available, coinciding with asset prices bottoming out and ASX pricing arguably on the mend in the aftermath of the GFC.”

In last year’s PKF REIT Monitor report it was observed that trusts were moving away from bank debt as their only source of funding.

”Over the 2010 financial year this has continued to occur,” Mr Psaltis said.

Story by Carolyn Cummins www.smh.com.au

Tags: economy, finance, investment, marketing, property, real estate, research

Facebook to trademark the word “face”

FacebookFacebook has moved one step closer in its efforts to trademark the word “face”, after receiving the green light from the US Patent and Trademark Office.

The Office has issued a notice of allowance to the social networking juggernaut, allowing the company to own the word after paying a fee, the NY Post reported.

The trademark will allow Facebook to challenge any of the 89,000 websites using the word “face” in their domain name.

The trademark would cover “telecommunication services, namely providing online chat rooms and electronic bulletin boards for transmission of messages among computer users in the field of general interest and concerning social and entertainment subject matter, none primarily featuring or relating to motoring or to cars”.

A Facebook spokesperson would not reveal why an exemption was given to cars.

Several companies are considered to be in the sights of Facebook’s legal department, including Apple over its video conferencing service Facetime and a pornography website called Faceporn.

Facebook has also sued websites Teachbook, Placebook and Lamebook in order to protect the social network’s identity.

Facebook has already been successful in trademarking the words “Like” and “Wall”.

Source: ninemsn.com.au

Tags: brand, facebook, marketing, news, social networks

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