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Get free tools & tips Tell a colleague about us Who else uses Express Commission?In September 2010 Express Commission provides commission advance s to leading residential, commercial, and industrial real estate agencies and business brokers across Australia. Our clients are based in every state of Australia and include both independent agencies and members of Australia’s most successful real estate groups including:
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Express Agent News 23 Oct 2007 issue Selected article shown below. See all articles for this issue.
Industry News.
Listing Boot Camp to be held in Brisbane November 16th The only real estate training program to address the number one essential process of getting more listings will be held in Brisbane on Friday November 16. Listing Boot Camp is a one day, action packed bonanza of listing ideas and strategies. Presented by Real Estate Marketing expert, Ray Wood and Global Real Estate Coach, Grant Thorpe, this special one-off event will change the way you think about marketing yourself and give you all you need to make the next 12 months the best year of your career. Places are filling fast so register now to join Real Estate’s top performers at this career-changing event. As a subscriber to this newsletter, your investment is $197 including lunch (a saving of more than $100 off the standard registration price) In addition you will receive A special ‘Listing Boot Camp’ package of training essentials with over 4 hours of dynamic Real Estate success training plus a copy of Ray’s best selling Lead Generator How To Sell your Home For More. That’s a total value of more than Express Commission have been chosen as the major Listing Boot Camp Marketing Partner. To register go to www.listingbootcamp.com For Express Commission newsletter recipients Your Discount Code is EC2929 Simply enter this code when prompted on the payment page to receive your Special Express Commission Discount and reserve your place.. We look forward to seeing you there. Register now at www.listingbootcamp.com
The Sydney residential property market still has the greatest potential for growth on Australia’s East Coast
Despite a possible tightening of credit as a result of the US sub prime mortgage crisis, the Sydney residential property market still has the greatest potential forgrowth on the East Coast, according to the 19th Australian Property Institute (NSW Division) Property Directions Survey. “The Property Directions Survey is a comprehensive, independent survey of property professionals. Respondents are Valuers, Fund Managers, Property Analysts and Property Financiers.“Conducted every six months, the Property Directions Survey has become one ofthe most credible sources in Australia for gauging sentiment among propertyprofessionals,” API NSW President Mr Webster said today. US Sub Prime Mortgage Market Overseas Property Investment by Australians Impact of Superannuation funds on the property market The Industrial property market was felt to have moved back from its position in the April survey; however respondents still saw growth potential with all three cities peaking in 2009. Retail property is also seen to have moved backwards from the April survey. Respondents felt the growth potential would peak in 2008 and a downswing across all three cities was seen for 2009. “Significantly, in the residential property market, respondents felt that Sydney had the greatest potential for growth across the three cities – with an upswing predicted for 2008 and continuing into 2009 in Sydney, Melbourne and Brisbane,” Mr Webster said. Property Trusts/Syndicates“While sentiment is not as strong as it was 12 months ago – the large majority of respondents still see moderate growth in domestic listed and unlisted propertytrusts/syndicates over the next 12 months,” Mr Webster said. Mr Webster said that respondents were also less positive than 12 months ago butstill see moderate to strong growth for international listed trusts/Syndicates. Moderate growth was also seen for international unlisted trusts. Non-residential Property Sector vs Equity Market Leasing Incentives
Ray White finance & Xinc in merger. In a move that those involved say could alter the face of the mortgage industry X Inc Finance merged yesterday with real estate agent Ray White Group’s eMOCA eMOCA and X Inc Finance has announced they would merge to set in place the baseline entity to create the country’s leading branded mortgage broker business. The transaction will combine X Inc Finance with Ray White Group’s Electronic Mortgage Organisation Channels of Australasia Pty Ltd (eMOCA Australia), comprising Ray White Financial Services, Loan Market and REA Home Loans. The merged group will have 500 mortgage brokers across the country writing approximately $600 million worth of loans every month. Jennifer Nielsen, Chief Executive Officer of the new group and formerly X Inc CEO, said the transaction would create a larger, more efficient group with the ability to handle greater volumes of business at a time of significant growth in the mortgage broking industry. “This merger combines X Inc and eMOCA – two of the fastest growing companies in the industry – to create an exceptional base to build a very powerful branded aggregator,” Ms Nielsen said. Sam White, the new group’s Chairman, said X Inc and eMOCA were an excellent fir culturally and geographically. The two companies also had complementary business development skills, with eMOCA having grown through strong referral partners, particularly real estate agents, and X Inc through consumer marketing and the creation of a brand identity. The merged entity’s six-person board will have three Ray White Group directors and three X Inc directors. Senior management will comprise: · Sam White, Chairman The merged entity will initially operate three brands – X Inc, Loan Market and REA Home Loans. There were no plans in the short-term to consolidate any of the brands, with each business to enjoy the full support of the new group. Similarly, while there will be some rationalisation of the businesses, redundancies are not envisaged over the long term.
Home loans plummet as housing moves out of reach The August interest rate rise also dented consumer confidence, while loan cancellations surged to record highs, growing 13.6 per cent in the month. Bureau of Statistics figures show the value of housing finance approvals fell 0.3 per cent in August to $22.2 billion. This was mainly due to investor loans falling 4.5 per cent to $6.9 billion. Despite the August rate rise, 64,365 people secured finance to buy homes, an increase of 1.6 per cent, and the value of owner-occupied housing rose by 1.7 per cent to $15.3 billion. But higher rates and low affordability continued to lock first-home buyers out of the market, with the proportion of first home-buyer loans falling from 17.4 per cent in July to 17.1 per cent in August. More people also decided to take out insurance against further rate rises, with the proportion of fixed-rate home loans rising from 14.8 per cent to 17.1 per cent. "The rate hike in August by the Reserve Bank has further damaged the housing sector, with home owners and renters facing greater living expenses," said CommSec equities economist Martin Arnold. "Affordability is being dampened … and is the major reason for the sluggish growth in the property market in recent years. Tenants are anticipating further rental increases as landlords try to offset greater interest payments." He said potential home buyers cancelled $2.03 billion of previously committed loans in August, up 21 per cent on last year. The proportion of first-home buyers in the market was also below the decade average of 18.8 per cent. Westpac senior economist Matthew Hassan said that while the Sydney and Perth housing markets had experienced "affordability crunches" in 2003 and 2006, "the risk is that Brisbane, Melbourne and Adelaide may follow". Mr Hassan said that based on a Westpac measure — the cost of servicing a loan of 75 per cent of the median house price as a proportion of the average wage — housing affordability nationally was at its lowest since mortgage interest rates reached 16-17 per cent in 1989-90. With affordability stretched tight and interest rates potentially rising further in the year ahead, it was "possible that the next upswing cycle in housing could see strong building but relatively flat prices". A paper published in The Australian Economic Review, suggests that house prices in Sydney and Melbourne are most sensitive to interest rate rises. The paper, by Glenn Otto, of the University of NSW's school of economics, suggests that a a mortgage rate of 25 basis points reduces the long-run quarterly growth rate of real house prices by about 1 per cent in Sydney and Melbourne, compared with 0.4 per cent in Adelaide. Housing Industry Association chief economist Harley Dale said the gap between housing supply and demand had been exacerbated by the weakness in lending for new construction. While the construction of new dwellings for owner-occupied housing was up slightly, by 2.7 per cent in the month, there was no improvement on a yearly basis, and the number of dwellings constructed for rent or resale fell. "A recovery in new home building is a crucial requirement for the Australian economy, but affordability is so low that there is still no sign of a sustainable recovery," he said. Federal Treasurer Peter Costello said the Coalition's key strategy for keeping housing affordable was to put downward pressure on interest rates and ensure more people had jobs. "It is also important we look at the supply side of housing to try and get more land released for housing, and more houses built," he said. Mr Costello has previously proposed increasing supply by releasing Commonwealth defence land, but is yet to release the results of the Federal Government's land audit. ANZ's head of financial systems analysis, Paul Braddick, said demand for finance in August would have been affected by the recent financial market turmoil, but underlying momentum remained strong. "Strong growth in household disposable income is being buoyed by solid wages and employment gains, along with further income tax cuts from July 1," he said. The August rate rise has continued to hurt consumer sentiment. The Westpac-Melbourne Institute Consumer Sentiment Index dropped 0.3 per cent in October, following an 8.1 per cent fall after the August rate rise. "The result is a little disappointing in that the index is still 4.5 per cent below the level prior to the rate hike," said Westpac chief economist Bill Evans. Political issues also affected sentiment, with the confidence of ALP voters up a further 4.8 per cent, to be 16.4 per cent higher over the year. Conversely Coalition voter confidence levels fell, by 4.5 per cent in October, and by 6.3 per cent over the year. The Department of Employment and Workplace Relations' leading indicator of employment fell for the fourth month in a row, signalling that employment might be growing more slowly in nine to six months than its long-term trend rate of 2.6 per cent a year. Job figures to be released today are expected to show 20,000 jobs were created in September, with the unemployment rate remaining at a 33-year low of 4.3 per cent.
Australian personal debt higher than during the great depression Dr Keen, author of a monthly chronicle Debtwatch, said that debt stress is showing up in the rising insolvency figures for New South Wales and Victoria. The numbers show a surge of 12 per cent in the September quarter, compared with the same period in 2006. Dr Keen expects insolvency rates to increase even more over the present quarter. During the interview, Dr Keen expressed concerns that Australians have the largest levels of debt in 150 years and “people are now under more financial stress than they have been at any time since the absolute peak of the Great Depression.” Dr Keen noted that the debt to GDP (gross domestic product) ratio is more than twice the percentage it was during the great depression, and twice what it was during the Melbourne land boom, the biggest speculative bubble in Australia’s history. According to Dr Keen, the main cause of financial stress has been excessive borrowing and speculation on house prices. “We’ve encouraged people — certainly in the last 15 years in particular — to borrow money to go and buy an asset which they expect to sell to somebody else for a higher price. But it’s a merry-go-round. The only way you can keep on doing it is somebody else borrows yet more money than you’ve done and they’ve got to borrow the money faster than they’re earning the income. And ultimately we’re getting to the crunch point where that game no longer works,” he said. In discussing the solution to the problem, Dr Keen said that ultimately there will need to be a substantial increase in debt moratoria. Looking at the causes of the problem, Dr Keen said, “I don’t blame individuals for falling into this trap. In blame the regulators and the people running the economy for convincing people that this is actually sensible investing, when in fact all it’s doing is gambling about housing prices and borrowing money for the gambling.” Dr Keen believes that a recession will be the result of too much debt. “I can’t see how one can be avoided — that’s why I’ve given it the nickname of ‘The Recession We Can’t Avoid’. Because even if households simply try to bring their balance sheets back into equilibrium and stop increasing the ratio of debt to household income, that is going to cause something in the order of a $100 billion a year drop in aggregate demand. Now I can’t see how the economy can absorb that without going into a recession,” he said. Dr Keen thinks that despite continued borrowing and “papering over the problem” a recession is inevitable in the next two years. He expressed his view that the Reserve Bank needs use a number of methods to solve the problem. “I think the Reserve Bank has been rather monophobic and it's totally focused upon the rate of inflation and seen its job simply as controlling the inflation rate and believes that by putting up interest rates it drives down the rate of inflation with a lag,” he said. “And I think that monophobia is potentially very dangerous, because if they do it again now — put up rates because inflation may tick up in the next quarterly data — then we will be experiencing a greater level of financial stress than during the Great Depression. And if they think the economy can cope with that, well good luck. I don't believe it can." Do you have any feedback on this article or ideas for a topic that you would like us to cover in future editions? |
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