For baby boomers ‘fear’ wins.

This will seem simplistic and controversial but it’s time we faced up to a demographic reality, for our aging population an unavoidable psychological state has become overwhelmingly prevalent, the cup is now half-empty. Journalistic commentary via the major financial media sources can be split into two camps the fear camp, predominantly those representing the baby-boomer generation, and the optimists, being the Gen X, Y and now Z’s. As one commentary we crossed recently put it, it’s created a financial situation where those in the baby-boom generation (the holders of majority of major assets) are developing a concentrically smaller mindset in terms of wealth whilst those in the younger generations simply do not have the financial clout to overcome a disproportionate distribution of assets. In simple terms there are those that can’t afford to sell and those that can’t afford to buy. An economic impasse is the consequence. Can the reality of this demographic psychology be ignored? Of course there are exceptions to the journalistic encampment rule (Ross Gittins of the SMH we are looking at you). However, true innovative thinking, be it financial or social, won’t flourish when oppressed by ageing conservatism. There is no place for global economic naivety, in going on five years Europe has failed to adequately address it’s problems, America’s recovery remains tentative and China’s growth has necessarily slowed. But our own growth and resilience as an economy is being hampered from within. Is it time the older generation reassessed their stance and question their legacy? Is this necessarily a new phenomenon or magnified by our populations weighting? Should we be surprised that the middle-class is predicted to continue to decline? Of course time will tell.

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Adam Carr – “even the English are referring to Australians as ‘whinging Aussies’.”

Brilliant article from Adam Carr highlighting the disparate nature of our sound economy and the morbid need for gloom. While an interest rate cut could well see overall confidence drop further once again we wonder just how long and how much larger an event will it be to trigger a change of leadership in government consequently allowing the turn of sentiment, something so many are crying out for. More…

Take a closer look at Sydney falls.

Yesterday’s much publicised May housing figures for Sydney supplied by RP Data and handled as delicately as only our media know how (Ed: The only thing Channel Ten had missing was a reference to the forthcoming apocalypse as predicted by the Aztec calendar) deserve some greater review. Thankfully Cameron Kusher has provided his take on the figures noting “the biggest house price falls in Sydney last month were at the prestige end (down 6.4 per cent), which dragged the rest of the market lower. The most affordable 20 per cent of houses actually rose slightly, while the middle 60 per cent fell by 0.4 per cent.” Thanks for the clarification Cameron. More…

Buyers on Green Light.

With the NAB revising its June assessment of the RBA’s predicted movement, indicating a reduction in the cash rate, and Bill Evans from Westpac now predicting rates will hit record lows by the end of 2012 (try 2.75%), investors and first home buyers have been given a green light. Add to this changes in lending criteria from banks which now take into consideration casual and secondary incomes when assessing mortgage applications and you have a primed demand equation as we progress toward Spring.

CBRE thinks so…

The most recent OECD economic outlook report, released last night in Paris, has shown Australia’s projected economic growth close to the top three during 2012, behind only South Korea, Mexico and Chile. Long term projections to 2050 give Australia the highest growth rate in the developed world after Chile and Mexico. The report has underlined the high dollar, consumer confidence and jobs continue to drag on property prices (ED: as at posting the Aussie $ had dipped below 98c US.). Of note were projections to 2050 giving Australia the highest growth rate in the developed world after Chile and Mexico. So overall Australian’s should have reason to shake off the pessimism, eventually. Certainly CBRE see sunshine on the horizon. After taking a long hard look at the last twelve months sales data the team at CBRE have no doubt seen the opportunity to take a more aggressive approach in direct real estate investment market. No doubt other majors are attempting to position themselves, some more effectively than others… More…

Sydney Simmers

Affirmation from preliminary indicators on last weeks report for Sydney auction results with clearance rates confirmed as the best for 2012, so far…. APM indicates a clearance rate of 61.8% (Ed. not bad in any market). Price growth seems to be teetering and the onset of winter will be challenging for some. Here’s to seeing the result spread nationally to validate a turning point for all. More…

Winter is coming, momentum counts…

Positive signals across the board supporting our more recent posts on market activity in Sydney and Melbourne. Over the weekend Sydney recorded a 61.8% clearance rate from 359 properties whilst Melbourne recorded a clearance rate of 63% out of 591. More…