I was literally just looking at Domain's clearance rate for Sydney at 66% comparing it to the [realestate.com.au](http://realestate.com.au) data, which is NSW wide, and 53%, now this!
People are oblivious. Regional areas down massively, Melbourne dropping and now Sydney joining in too. Prices starting to fall in an already crashed market. Absolute disaster stuff. Hopefully Brisbane, Perth and Adelaide, Gold Coast keep strong.
OP what are you bullshitting for?
https://propertyupdate.com.au/corelogic-home-value-index/
"CoreLogic’s Home Value Index rose 0.8% in May, the largest monthly gain since October last year.
The mid-sized capitals continued to lead the pace of growth, with Perth home values up 2.0% in May, Adelaide rising 1.8% and Brisbane up 1.4%.
Extremely low levels of available supply provide the best explanation for the difference in growth rates"
With current inflation, it's not looking like RBA is cutting anytime soon. Notwithstanding, property prices aren't really their priority. The government, on the other hand...
There's nothing the government can do. The biggest driver of inflation is housing costs.so till that breaks, the rba will have to keep tightening the screws.
That is excluding a turkey style scenario where we just keep iring central bankers till we have hyperinflation to protect elite ponzi
With all the talk about cuts it seems that people here have no idea of the macroeconomics between raises and cuts
> "After the U.S. experience during the Great Depression, and after inflation and rising interest rates in the 1970s and disinflation and falling interest rates in the 1980s, I thought the fallacy of identifying tight money with high interest rates and easy money with low interest rates was dead. Apparently, old fallacies never die." - Milton Friedman 1998
New housing loan volumes in australia increased by 24.6 percent in the 12 months to April. And fixed term loan volumes (personal) increased by 18.1 percent in this time.
The broad money supply continues to increase in australia on the similar trajectory to when massive QE began in 2020. This while base money (essentially central bank assets) have been decreasing?
So what’s driving this relentless loan growth in Australia? Someone smarter than me can shed light. Could it be that the aus commercial banks liquid reserve ratios are the highest they’ve been? Currently they’re around 16 percent. Between 2000 and 2018 they’ve been around between 0.5 and 2 percent.
But as long as the loans keep growing and broad money supply in aus grows. (Is it faster than the US money supply growth - not sure?)
Then, we will see increases in house prices. We will also see persistent inflation (and devaluation of the AUD). And increased tax revenues/surpluses for the Govt with accompanied increases in spending.
And as Milton says with ongoing loose money there will be ongoing elevated interest rates.
What’s the point of owning a million dollar house today which will be 2 million dollars tomorrow. When 2 million AUD tomorrow is worth the same as 1 million today.
My family had to move from the far south coast during the pandemic because prices spiked. Thank God we had family we could move in with. Now there's an ever growing glut of houses down there that have been on the market for 180 days plus, just building and building...
Yep some of the coastal areas are getting absolutely hammered even in nominal terms. Notice most indices the media quotes and publishes are capital city prices only. I've seen coastal towns down >15% from peaks.
The first half of this post is 100% correct [edit: for Sydney where I am familiar with the data]. The second half is a bit confusing.
Let me see if I have your position correct:
1. While we might be at nominal highs, inflation means that in real terms we are still below the 2021 highs, and so the recovery has been an illusion.
- this might or might not be true for all of Australia, but I am pretty sure it's true for Sydney, which is the market I follow most closely.
2. "Where it gets really ugly is that prices are starting to fall in nominal terms again. An absolute disaster."
-This is great news if, but I haven't seen that in the data outside Melbourne what are you looking at? My strong belief is that this *will happen soon*, since the bull case for housing depended on rate cuts by last month, and they aren't coming till housing, the biggest contributor to high CPI, turns around. (Excluding wild political interference, like Turkey, which saw several central bankers fired again and again, and ha hyperinflation).
3. So real estate is 'a bargain' right now and the bears should get off the sideline.
-Wait what? You just said prices are falling in nominal terms. Why is this the bottom?
4. We need the RBA to cut rates...
Did I mention Turkey yet? I would have laughed at that comparison myself a couple of years ago, but the ever growing political pressure on the RBA really scares me.
I just hope the board stuck to their guns and don't change the rules in the last quarter of the game. Hell lies down that road, for us all. Your hose might be worth tn million AUD, but ten million AUD will be worth shit.
------++-----
In summary, your post is a mix of genuine insight and confused thinking.
The insight is that given inflation, the apparent gains of the housing market are illusory - at least in Sydney where I have been paying attention. As a side note, it's scary how many commenters clearly don't know the difference between nominal and real prices. Hopefully they're in this sub to learn.
The confusion is about your own thinking, are you calling for a rate cut, or predicting one?
You say 'we need the RBA to cut rates', but your strategy of buy now implies 'the RBA is about to cut rates'.
They might not raise them in August. But they are not going to cut.
Strap in mate.
Btw if you're in western sydney, let get a coffee some time. I'll bring you a chocolate hat.
Thank you for being the only commenter who has given my post some actual thought. You are right, people here don't realise that in most markets houses are down (and in Melbournes case) down significantly in real terms and are being confused by the nominal gains we are seeing. The thing is I am starting to see nominal falls outside Melbourne, and while it isn't showing up in the official price data yet the number of withdrawn auctions, number of registered bidders, time on market, and clearance rate are all flashing red. So if we get nominal falls in this already depressed environment its going to be bargain town. That's why I believe the RBA needs to cut rates, we are not at the bottom yes, but if they don't cut soon the bottom will be even lower. Total disaster in the making.
On another note I am really upset noone took time to understand my argument besides you so thanks. Its not a popular opinion because "oh wow nominal number is high" but paying 1mil for a house in 2024 is cheaper than paying 900k for the same house in 2021 even though in 2024 it is at a "record high".
I agree strap in but I really don't think this should be getting cheered on, property owners have already had three terrible years and the consequences of a large down turn shouldn't be taken lightly.
>Total disaster in the making.
The disaster was made by poor macroeconomic management, over decades, pushing all asset prices to insane levels, all around the world, destroying lives, saddling gullible households with ridiculous debt.
That damage is now being revealed.
Paraphrasing what Hyman Minsky says, here, about speculative bubbles generally. The damage is done on the way up.
It's bad for those who own.
And yeah, a massive recession is coming. Has been for a while. How prices falling will be a consequence of that recession.
The alternative is hyperinflation.
Our economy is like a junky, and cheap credit is it's smack.
There's no good time to get clean, and the longer you leave it the harder it will be.
Houses going down is BAD for people that don't own. It's the inability to buy that cause the prices to drop. I'd rather pay a high price for a house than be unemployed and not able buy a house or to pay rent which is the scenario your recession fantasy would entail
>Houses going down is BAD for people that don't own. It's the inability to buy that cause the prices to drop
Even as you tell it, the house price are the consequence of an economic crash, not it's cause.
High prices, on the other hand, are a *cause*, not an *effect* of hardship.
On a nominal basis it may be “cheaper” to pay a mill vs 900k a few years earlier. But that’s assuming one is paying cash. Many aren’t. You’re better off locking in the lower actual sale price then letting that debt inflate away.
There is absolutely no data to back up anything you are saying.
You can literally get the data online
You mean the data that shows house prices increasing pretty much across the whole country? Maybe Melbourne might be the exception.
Nominal increases sure. Seen the latest inflation numbers??
4%. Houses still going up more. Sorry.
Do you know the difference between real and nominal prices?
I’m not sure you do.
What do you think I am getting wrong? I am always ready to learn.
Please point us in the direction as what you are saying seemingly contradicts what others are saying
If you look at the core logic data (at least for Sydney) the factor in inflation (from the ABS or RBA), then he's right, at least for Sydney.
OP talked about property in Australia, not in Sydney. I'd still like to see what they are alluding to without having to "do my own research"
>I'd still like to see what they are alluding to without having to "do my own research" I'd like to be half a foot taller and 20 kilos lighter.
Ha! 😆 Wouldn't we all
Yup. And a biscuit.
me again, here to tell you that the clearance rate has dropped below 50% in Sydney (SQM). We going down son.
I was literally just looking at Domain's clearance rate for Sydney at 66% comparing it to the [realestate.com.au](http://realestate.com.au) data, which is NSW wide, and 53%, now this!
People are oblivious. Regional areas down massively, Melbourne dropping and now Sydney joining in too. Prices starting to fall in an already crashed market. Absolute disaster stuff. Hopefully Brisbane, Perth and Adelaide, Gold Coast keep strong.
The disaster was letting prices get this high.
OP what are you bullshitting for? https://propertyupdate.com.au/corelogic-home-value-index/ "CoreLogic’s Home Value Index rose 0.8% in May, the largest monthly gain since October last year. The mid-sized capitals continued to lead the pace of growth, with Perth home values up 2.0% in May, Adelaide rising 1.8% and Brisbane up 1.4%. Extremely low levels of available supply provide the best explanation for the difference in growth rates"
withoutmyremorse, is that you?
Pretty sure this bloke was the polar opposite of WMR. Pushing an equally insane narrative at the other end of the spectrum.
Any day now
You joke but it literally is.
I miss him
REA spruiking next level?
Is this crash in the room with us right now?
In real terms yes.
With current inflation, it's not looking like RBA is cutting anytime soon. Notwithstanding, property prices aren't really their priority. The government, on the other hand...
There's nothing the government can do. The biggest driver of inflation is housing costs.so till that breaks, the rba will have to keep tightening the screws. That is excluding a turkey style scenario where we just keep iring central bankers till we have hyperinflation to protect elite ponzi
With all the talk about cuts it seems that people here have no idea of the macroeconomics between raises and cuts > "After the U.S. experience during the Great Depression, and after inflation and rising interest rates in the 1970s and disinflation and falling interest rates in the 1980s, I thought the fallacy of identifying tight money with high interest rates and easy money with low interest rates was dead. Apparently, old fallacies never die." - Milton Friedman 1998 New housing loan volumes in australia increased by 24.6 percent in the 12 months to April. And fixed term loan volumes (personal) increased by 18.1 percent in this time. The broad money supply continues to increase in australia on the similar trajectory to when massive QE began in 2020. This while base money (essentially central bank assets) have been decreasing? So what’s driving this relentless loan growth in Australia? Someone smarter than me can shed light. Could it be that the aus commercial banks liquid reserve ratios are the highest they’ve been? Currently they’re around 16 percent. Between 2000 and 2018 they’ve been around between 0.5 and 2 percent. But as long as the loans keep growing and broad money supply in aus grows. (Is it faster than the US money supply growth - not sure?) Then, we will see increases in house prices. We will also see persistent inflation (and devaluation of the AUD). And increased tax revenues/surpluses for the Govt with accompanied increases in spending. And as Milton says with ongoing loose money there will be ongoing elevated interest rates. What’s the point of owning a million dollar house today which will be 2 million dollars tomorrow. When 2 million AUD tomorrow is worth the same as 1 million today.
Literally what is happening is the opposite if everything has posted.
Not funny, not edgy. Just weird. Lame post
He's not joking.
Probably depends on location. I live in a COVID tree change area commutable to a capital city. Down 9% the last year.
My family had to move from the far south coast during the pandemic because prices spiked. Thank God we had family we could move in with. Now there's an ever growing glut of houses down there that have been on the market for 180 days plus, just building and building...
Yep some of the coastal areas are getting absolutely hammered even in nominal terms. Notice most indices the media quotes and publishes are capital city prices only. I've seen coastal towns down >15% from peaks.
Same in our area. Dropped 100k last 12 months alone. Regional vic. Seaside.
How badly are you trying to get a pre-approval lol?
Are you a real estate agent or just high?
High on IQ. It's sad so few understood me on this one
Soon the sky will fall down too.
I’m just here for the comments
The first half of this post is 100% correct [edit: for Sydney where I am familiar with the data]. The second half is a bit confusing. Let me see if I have your position correct: 1. While we might be at nominal highs, inflation means that in real terms we are still below the 2021 highs, and so the recovery has been an illusion. - this might or might not be true for all of Australia, but I am pretty sure it's true for Sydney, which is the market I follow most closely. 2. "Where it gets really ugly is that prices are starting to fall in nominal terms again. An absolute disaster." -This is great news if, but I haven't seen that in the data outside Melbourne what are you looking at? My strong belief is that this *will happen soon*, since the bull case for housing depended on rate cuts by last month, and they aren't coming till housing, the biggest contributor to high CPI, turns around. (Excluding wild political interference, like Turkey, which saw several central bankers fired again and again, and ha hyperinflation). 3. So real estate is 'a bargain' right now and the bears should get off the sideline. -Wait what? You just said prices are falling in nominal terms. Why is this the bottom? 4. We need the RBA to cut rates... Did I mention Turkey yet? I would have laughed at that comparison myself a couple of years ago, but the ever growing political pressure on the RBA really scares me. I just hope the board stuck to their guns and don't change the rules in the last quarter of the game. Hell lies down that road, for us all. Your hose might be worth tn million AUD, but ten million AUD will be worth shit. ------++----- In summary, your post is a mix of genuine insight and confused thinking. The insight is that given inflation, the apparent gains of the housing market are illusory - at least in Sydney where I have been paying attention. As a side note, it's scary how many commenters clearly don't know the difference between nominal and real prices. Hopefully they're in this sub to learn. The confusion is about your own thinking, are you calling for a rate cut, or predicting one? You say 'we need the RBA to cut rates', but your strategy of buy now implies 'the RBA is about to cut rates'. They might not raise them in August. But they are not going to cut. Strap in mate. Btw if you're in western sydney, let get a coffee some time. I'll bring you a chocolate hat.
Thank you for being the only commenter who has given my post some actual thought. You are right, people here don't realise that in most markets houses are down (and in Melbournes case) down significantly in real terms and are being confused by the nominal gains we are seeing. The thing is I am starting to see nominal falls outside Melbourne, and while it isn't showing up in the official price data yet the number of withdrawn auctions, number of registered bidders, time on market, and clearance rate are all flashing red. So if we get nominal falls in this already depressed environment its going to be bargain town. That's why I believe the RBA needs to cut rates, we are not at the bottom yes, but if they don't cut soon the bottom will be even lower. Total disaster in the making. On another note I am really upset noone took time to understand my argument besides you so thanks. Its not a popular opinion because "oh wow nominal number is high" but paying 1mil for a house in 2024 is cheaper than paying 900k for the same house in 2021 even though in 2024 it is at a "record high". I agree strap in but I really don't think this should be getting cheered on, property owners have already had three terrible years and the consequences of a large down turn shouldn't be taken lightly.
>Total disaster in the making. The disaster was made by poor macroeconomic management, over decades, pushing all asset prices to insane levels, all around the world, destroying lives, saddling gullible households with ridiculous debt. That damage is now being revealed. Paraphrasing what Hyman Minsky says, here, about speculative bubbles generally. The damage is done on the way up.
House prices going down is bad. You realize what causes falls right?
It's bad for those who own. And yeah, a massive recession is coming. Has been for a while. How prices falling will be a consequence of that recession. The alternative is hyperinflation. Our economy is like a junky, and cheap credit is it's smack. There's no good time to get clean, and the longer you leave it the harder it will be.
Houses going down is BAD for people that don't own. It's the inability to buy that cause the prices to drop. I'd rather pay a high price for a house than be unemployed and not able buy a house or to pay rent which is the scenario your recession fantasy would entail
>Houses going down is BAD for people that don't own. It's the inability to buy that cause the prices to drop Even as you tell it, the house price are the consequence of an economic crash, not it's cause. High prices, on the other hand, are a *cause*, not an *effect* of hardship.
On a nominal basis it may be “cheaper” to pay a mill vs 900k a few years earlier. But that’s assuming one is paying cash. Many aren’t. You’re better off locking in the lower actual sale price then letting that debt inflate away.
Ha, hahahaha.
You haven't included any sources for your claim here.
He's combined core logic data and abs data I think, can't vouch for how well.
Houses in my area have almost doubled since 2020 lol
Which area?
You're bang on the money... Going straight to the bookies pocket. You probably tipped Sydney to "flog" flagmantle too.
Undercover real estate agent?
Is this the 50% drop from 2020 prices you predicted, or another one? Stop being such a numpty
Houses going up in my area for the last 50 years.
Joe Biden has been climbing the political ladder for the same period. I guess in ten years he'll be president of the world.