There are probably more FIFO big wages lost in NSW than WA, will their property market drop by triple the previous historical records too?
The reason that WA has had many FIFO's from elsewhere is that with WA's small population, the pool of local labour easily available for high-paid mining jobs became exhausted as the boom went parabolic. I tend to feel that this will likely affect WA more than you are arguing it will (ie, not at all apparently).
The large numbers of interstate and foreign FIFO's who came to WA did not do so because nobody was hiring locals - they were hired because there simply weren't enough locals to service this massive investment boom. If there were 10 FIFO's from NSW and Vic going for every 1 permanent Perth-based one, the impact on WA might still be significant because NSW and Vic together have more than 10 times WA's population.
In other words, NSW and Vic can lose a lot more dollars without effect than WA probably can. Context and proportionality are important here.
The large numbers of interstate and foreign FIFO's who came to WA did not do so because nobody was hiring locals - they were hired because there simply weren't enough locals to service this massive investment boom.
There wasn't enough suitably qualified and experienced labour period.
There was a joke in the industry at the height of the boom in maybe 2012, that "If you know what colour CAT trucks are painted, you can get a job fixing them."
And as to employing recent graduates in some of the professions and some of the cockups that might have led to, I personally heard of one doozy. Expect there were lots. And expect some are yet to be realised.
It was an interesting time.
A Professional Demographer to an amateur demographer:"negative natural increase will never outweigh the positive net migration"
If ever there was a sign of the slowdown in Western Australian economy, it was yesterday's wages data, released by the ABS, which revealed that wages growth in Western Australia slowed to just 2.4% in the year to June in raw terms, the lowest rate of growth on record, and below the national average of 2.6% growth.
Not surprisingly, the mining sector is the cause of the decline, with wages growth in mining just 2.5% in the year to June, albeit growth has picked-up slightly from the March quarter.
As for the future outlook for Western Australian wages growth, mining and energy-related capex has only fallen moderately from its peak and clearly has much further to fall.
The reason that WA has had many FIFO's from elsewhere is that with WA's small population, the pool of local labour easily available for high-paid mining jobs became exhausted as the boom went parabolic. I tend to feel that this will likely affect WA more than you are arguing it will (ie, not at all apparently).
The large numbers of interstate and foreign FIFO's who came to WA did not do so because nobody was hiring locals - they were hired because there simply weren't enough locals to service this massive investment boom. If there were 10 FIFO's from NSW and Vic going for every 1 permanent Perth-based one, the impact on WA might still be significant because NSW and Vic together have more than 10 times WA's population.
In other words, NSW and Vic can lose a lot more dollars without effect than WA probably can. Context and proportionality are important here.
The overall effect of those people leaving is on the rental market was my argument. They did not buy homes in Perth and the property sales market stagnated during the investment boom.
I doubt there will be any significant effect on house prices and even on overall employment. I just don't see how such huge investment in the State could turn into a sad news story. It is certainly not been my own first hand experience of selling property here. I am sure others can back me up on this.
In Melbourne unemployment has increased more that that of Perth, with Victoria at 7% unemployment compare that to WA sitting on a low 5%. Why ? Perth employs the employees who benefit from the investment and are exporting in record volumes. It also has a healthy job economy that any city provides.
My question is valid why should Perth crash before Melbourne?
Perthite
13 Aug 2014, 11:15 PM
"There are probably more FIFO big wages lost in NSW than WA, will their property market drop by triple the previous historical records too?"
Delusion at its best.
The other states are set to benefit as interstate migration trends reverse. At WA's expense.
Where do you come up with this shit. Got any data to back up the BS?
Perthite you have been saying WA is doomed for a year now, yet unemployment has not really been significantly affected. Go to some home opens or land sale launches see the real market. It is not me who is deluded, you listen to too many east coasters selling bad news stories.
Definition of a doom and gloomer from 1993 The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
Perth faces an apartment glut from a cooling economy and slow population growth that are likely to leave the city with too many rooms.
Property analysts expect the former boom town, which has previously experienced housing shortages, to have an over-supply of apartments as early as next year following the completion of a record number of developments…
Concerns about a nascent apartment glut are confirmed by ABS data, which shows population growth moderating just as supply is starting to play catch-up.
Perth rents have fallen by 7% (houses) and 6% (units) respectively over the past year, according to Australian Property Monitors.
Perth rental vacancy rates are also rising fast and have recently climbed above the national average, suggesting further weak rental growth ahead.
The outlook for house prices is equally poor, with both prices and total finance commitments (excluding refinancings) slowing further over the June quarter, which given past strong correlations suggests that Perth house price growth will continue to moderate throughout the remainder of this year and into next.
Wages growth in Western Australia slowed to just 2.4% in the year to June in raw terms, the lowest rate of growth on record, and below the national average of 2.6% growth.
The outlook for incomes is similarly poor, given mining and energy-related capex has only fallen moderately from its peak and clearly has much further to fall.
Following the end of the mid-1970s mining boom, Perth house prices declined by nearly 30% in inflation-adjusted terms over an eight year period, and argued that similar falls could be on offer this time around.
Think long and hard before gearing-up to purchase Perth property as risks abound.
The overall effect of those people leaving is on the rental market was my argument. They did not buy homes in Perth and the property sales market stagnated during the investment boom.
I doubt there will be any significant effect on house prices and even on overall employment. I just don't see how such huge investment in the State could turn into a sad news story. It is certainly not been my own first hand experience of selling property here. I am sure others can back me up on this.
In Melbourne unemployment has increased more that that of Perth, with Victoria at 7% unemployment compare that to WA sitting on a low 5%. Why ? Perth employs the employees who benefit from the investment and are exporting in record volumes. It also has a healthy job economy that any city provides.
My question is valid why should Perth crash before Melbourne?
I don't agree that they didn't buy property. Many of them came here with equity from selling overseas or interstate and put it straight into property.
There is a massive difference between resource construction and production employment requirements. Also, because resource construction was on such a large scale, demand for skills far outstripped supply and wages were driven up to silly money levels.
I know welding QC's and Engineers who were brought over on FIFO swings from the UK and Germany (such was the demand for skills).
Production requires nothing like the level of manpower and with a large pool of skilled workers now resident in WA, there will be greater competition for these jobs.
As for the money earned from resource exports, Perth will see the royalty payments and that is about it. Bear in mind that WA is already in debt from spending big on infrastructure and that any mining royalty gains are largely offset by reduced GST allocation.
Add to that the falling price of resources and a slowing China and I think your point of view is wishful thinking at best.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be rising.
If ever there was a sign of the slowdown in Western Australian economy, it was yesterday's wages data, released by the ABS, which revealed that wages growth in Western Australia slowed to just 2.4% in the year to June in raw terms, the lowest rate of growth on record, and below the national average of 2.6% growth.
Not surprisingly, the mining sector is the cause of the decline, with wages growth in mining just 2.5% in the year to June, albeit growth has picked-up slightly from the March quarter.
As for the future outlook for Western Australian wages growth, mining and energy-related capex has only fallen moderately from its peak and clearly has much further to fall.
Are you seriously predicting a house price crash based on wages in WA not growing enough by 0.2%?
Perth prices to income are only 6.3 times the average WA income according to Rp Data, isn't Melbourne around 8?
Wake me up when Perth gets to 7% unemployment and prices rise to 8 times income, then you guys might finally see a correction, then again maybe not Melbourne is not showing much signs of a crashing property market hey?
To East coast doom and gloomers Perth is like this fairy tale land where they will finally see their dreams of misery visited on someone. WA has a great future did you guys miss the news of all the money that has been invested here?
Definition of a doom and gloomer from 1993 The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
Are you seriously predicting a house price crash based on wages in WA not growing enough by 0.2%?
Perth prices to income are only 6.3 times the average WA income according to Rp Data, isn't Melbourne around 8?
Wake me up when Perth gets to 7% unemployment and prices rise to 8 times income, then you guys might finally see a correction, then again maybe not Melbourne is not showing much signs of a crashing property market hey?
To East coast doom and gloomers Perth is like this fairy tale land where they will finally see their dreams of misery visited on someone. WA has a great future did you guys miss the news of all the money that has been invested here?
What a lonely battle you are fighting here.
Where is Shadberg PR to help you out?
They have cut WA loose Skamy and are focussing the daily spruik on the Eastern markets.
That should tell you something.
As someone likes to say around these parts, its supply and demand.
Supply is up. in fact, given the amount coming on line we are rapidly hitting oversupply.
Demand is down: wages falling, labour market tightening, migration in down, migration out up, vacancy rate skyrocketing, listings increasing.
When supply increases and demand falls, prices_______
Ill leave that blank for you to fill in the missing word.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?
The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly. Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
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