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Apartment glut warning: More cranes on Australian east coast than in North America
Topic Started: 21 Oct 2016, 01:35 PM (3,941 Views)
Ex BP Golly
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Rufus
21 Oct 2016, 06:50 PM
Maybe they do.

I'm not in disagreement with the thrust of the article, I expect a glut, but not as big a glut as we would have if we were building more apartments in Brisbane Sydney and Melbourne that in the entire geographical area of North America.

Does that clarify it for you.
Maybe we have more cranes because our bubble hasn't popped yet.

Underwater property owners are more plentiful, and.....cheaper than cranes in the US.

You should work on your leg muscles hey!
WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
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Terry
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Ex BP Golly
22 Oct 2016, 03:53 PM
Maybe we have more cranes because our bubble hasn't popped yet.

Underwater property owners are more plentiful, and.....cheaper than cranes in the US.

You should work on your leg muscles hey!
Yes, not sure if you saw my comment:

Perhaps, similar to Japan, construction is now cost-driven in the U.S; whereas construction costs are a secondary concern in Australia. That is a typical phenomenon in bubble-like conditions: Build at any cost knowing that price is not the sole driver of the purchase decision.

The bubble bursting has made the Japanese construction and related industries probably the most efficient, cost-effective, and quality driven in the world. During the bubble, it was a shonky shambles with its priority on making profits for as little productive input and output as possible. Unfortunately, that is what bubbles and high-cost structures create. OK, you can argue that Australia is making progress (architectural design for public infrastructure is being outsourced to Vietnam now), but we're still entrenched in the bubble mentality. I would argue that America has probably moved on from that to some extent, except in the financial sectors.
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Mallard
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Thread killer

The USA data only looks at cbd locations whereas in Australia it is the whole of the metro area. What a poor benchmark for comparison
Collecting desperation.
Ex-Bp Golly April 2 2015. "I see with a slight overshoot -70% [fall in Sydney house prices] as being well within possibility"
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Terry
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Mallard
22 Oct 2016, 04:59 PM
The USA data only looks at cbd locations whereas in Australia it is the whole of the metro area. What a poor benchmark for comparison
Nonsense. RLB's methodology for collecting data across metro areas is as follows:

-- Physically counting the cranes appearing on each city’s skyline,
-- Surveying RLB staff,
-- Contacting crane suppliers
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stinkbug
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Maybe cranes are in a bubble?
---------------------------------------------------------------

While it's true that those who win never quit, and those who quit never win, those who never win and never quit are idiots.

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Bardon
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stinkbug
22 Oct 2016, 08:04 PM
Maybe cranes are in a bubble?
We are setting up a smallish crane business in Doha. It was originally intended to serve our existing business there and stop us using suppliers but its gone a lot bigger already. There isn't enough cranes in the Gulf never mind Doha to build the stadiums and infrastructure for the World Cup, all of this on top of a super construction boom in Dubai and Abu Dhabi thats just starting.
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DragonGM
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The original article is a one dimensional comparison. Many US cities have more low-rise suburban development than Australian cities. So it is not comparing city growth v city growth. Just apartment growth vs apartment growth.

I still think it is a telling stat.
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Terry
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DragonGM
23 Oct 2016, 12:28 PM
The original article is a one dimensional comparison. Many US cities have more low-rise suburban development than Australian cities. So it is not comparing city growth v city growth. Just apartment growth vs apartment growth.

I still think it is a telling stat.
You probably shouldn't determine the research objective for the consultancy. If you said,

Many US cities have more low-rise suburban development than Australian cities.

they could reply. "so what?"

and if you said,

....it is not comparing city growth v city growth. Just apartment growth vs apartment growth.


they could reply by saying "no, it's a directional comparison of cranes in operations."
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Rufus
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DragonGM
23 Oct 2016, 12:28 PM
The original article is a one dimensional comparison. Many US cities have more low-rise suburban development than Australian cities. So it is not comparing city growth v city growth. Just apartment growth vs apartment growth.

I still think it is a telling stat.
I agree with both points.

Corelogic have put some perspective on the data. Great info HERE............

The relevant chart IMHO is this one.
Posted Image

It looks to me that the lift in Sydney will be absorbed although it will curb the rising prices in some areas for a couple of years, but Brisbane is leaping 25.4% which is huge. I don't believe the demand will soak that up quickly, that will probably depress the apartment market for 4 years, maybe longer.

Not sure about Melbourne. At 16.1% it should reduce prices but Melbourne is our fastest growing city.
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Attachments: rise_in_unit_stock.jpg (150.57 KB)
Edited by Rufus, 24 Oct 2016, 09:14 AM.
Take risks - if you win you will become wealthy, if you lose you will become wise
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Terry
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Rufus
24 Oct 2016, 09:07 AM
I agree with both points.

Corelogic have put some perspective on the data. Great info HERE............

The relevant chart IMHO is this one.
Posted Image

It looks to me that the lift in Sydney will be absorbed although it will curb the rising prices in some areas for a couple of years, but Brisbane is leaping 25.4% which is huge. I don't believe the demand will soak that up quickly, that will probably depress the apartment market for 4 years, maybe longer.

Not sure about Melbourne. At 16.1% it should reduce prices but Melbourne is our fastest growing city.
Nonsense. This has nothing to do with:

A.) A comparison of the number of cranes in use between selected Australian cities and selected U.S. cities

B.) The relative level of residential construction between selected Australian cities and select U.S. cities

If you're trying to express that there appears to be a surplus of apartment construction in Australia, then fair enough. Surely that's a good thing.
Edited by Terry, 24 Oct 2016, 10:14 AM.
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