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South Coast Property Specialists (Carlene Franzen) Tips #1074: Not Everyone Agrees with the Banks

Last week we reported how the major banks are predicting a likely Vol 16 September 15th 2017 Vol 28 December 7th, 2017 Vol 48 April 27th 2018 reduction in house prices in 2023. Just as a quick recap, the ANZ predicted 4% reduction, Westpac 5% reduction and CBA 10% reduction (with 12% reductions in Sydney and Hobart). But no sooner had these predictions been made we are now starting to see other analysts differ from these opinions, with one analyst describing the bank’s predictions as “nonsensical”. The reason for the different opinions is based on the questioning of two key assumptions both of which have the ability to change the market quite significantly:  An increase in interest rates with the Reserve Bank progressively lifting the cash rate to around 1.25% by the second half of 2023.  A lowering of demand (a key component in the “supply and demand” equation) Dr Andrew Wilson from Bluestone Home Loans questions both of these assumptions stating that the RBA itself had outlined expectations for the cash rate to remain at the current level until 2024, based on the central bank’s wage rise requirements and inflation targeting. Now obviously the RBA can change their mind, but he did go on to say that “For wages growth to meet the RBA requirements for a rate rise by November 2022 – the date predicted by those forecasting record price falls in 2023 – would require an unprecedented surge in incomes over coming months.” (Wouldn’t it be nice to get an “unprecedented surge in comes”?) On the second issue of a lowering of demand, he agrees with the comment we made in last week’s “tips” that opening international borders will lead to high migration levels which is set to “again place upward pressure on home prices in our still undersupplied housing markets”. I guess both these factors (and probably others) will certainly impact the housing market but at this stage it is evident that jury is still out on just how big or small that impact will be. Dr Wilson did note that “since 1987, Australia’s capital city housing market has experienced only three years where home prices have fallen – 2008, 2011 and 2018. And the price declines were clearly modest, falling by just 4.0 per cent, 4.1 per cent and 5.1 per cent, respectively”.

So, if the CBA is correct at 10% (12% for Sydney and Hobart), that would certainly be a correction in the order not seen for many, many years. Obviously, time will tell.

Vol 16 September 15th 2017 Vol 28 December 7th, 2017 Vol 48 April 27th 2018

Dec 10th - Richard Lawson – Tomakin Club (7.30pm) Dec 10th - Intensity Duo – Batemans Bay Soldiers Club Dec 11th - Intensity Duo – Batemans Bay Soldiers Club Dec 11th - Joe Driscoll – Tomakin Club (7.30pm) Dec 11th - Waikama – Waterfront Hotel (8pm) Dec 11th - Affinity Quartet - 2:30 pm St Paul’s Anglican Church, Narooma Dec 11th - Sco Stone at Club Catalina

Dec 12th - Rob Simpson – Tomakin Club (1pm) Beer Garden Sunday Sessions Dec 12th - Intensity – Club Narooma (3pm) Dec 17th - Guy Turk at Tomakin Social Club Dec 17th - Mick McGrath at the Batemans Bay Soldiers Club Dec 17th - Daniel Champagne will be returning to Smokey Dan's Dec 17th - Nine Lessons and Carols service at 7 pm - All Saints' Anglican Church, Bodalla

Affinity Quartet - 2:30 pm Saturday Dec 11 St Paul’s Anglican Church, Narooma Music by Schubert & Debussy Tickets $23 from Mitre 10 Gi s, Narooma & Nested on Wallaga, Bermagui; $25 at the door Kindly supported by Helen Ryan & Elizabeth OliverHawkey Since winning the ANAM Chamber Music Compe on in their inaugural year, Affinity Quartet has established itself as one of Australia’s leading string quartets. Their interna onal touring has included cri cally acclaimed performances in Europe at the Amsterdam String Quartet Biennale, Fes val Les Voix In mes Belgium, Fondazione Cini Venice, Mirabell Palace Salzburg; and in the UK at St Mar n-in-the-Fields, Southbank Centre, City Music Society, and Prussia Cove Interna onal Musicians Seminar.

The quartet is known for innova ve programs traversing the string quartet’s diverse history, including Australian commissions, world premières by Jack Symonds, Ma Laing and Darrin Archer (AU), and Australian premières of the complete string quartets of Leos Janáček and Pavel Haas; Benjamin Bri en and Sir Andrzej Panufnik. Affinity has been a featured ensemble in Melbourne’s underground classical series Play On Music, and ensemble-in-residence at Shepparton Fes val, Kennedy Nolan Architects, and 75 On Reid. In 2021-22 Affinity Quartet are Melbourne Recital Centre Local Heroes.

Vol 16 September 15th 2017 Vol 28 December 7th, 2017 Vol 48 April 27th 2018

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