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Sydney house prices to rise 15-20% in 2014; Chistopher's 2014 housing boom and bust report now out
Topic Started: 17 Sep 2013, 06:27 PM (18,871 Views)
Black_Dragon
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;)

http://www.theaustralian.com.au/business/property/sydney-on-track-for-property-boom-prices-set-to-rise-20pc-says-sqm/story-fn9656lz-1226721006886

http://www.bloomberg.com/news/2013-09-17/sydney-to-lead-australia-housing-in-2014-with-20-jump-sqm-says.html

http://www.propertyobserver.com.au/news/what-the-markets-will-do-over-2013/2014/2013091765065?utm_source=po&utm_medium=aida&utm_campaign=latestnews

You can find the new report here BTW.

http://www.sqmresearch.com.au/boombustreport.php

Edited by Black_Dragon, 17 Sep 2013, 06:27 PM.
"No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...and if it occasionally gets a little heavier than what you had in mind, well...maybe chalk it off to forced conscious expansion: Tune in, freak out, get beaten."My Webpage
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Shadow
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Nice work BD. So you're predicting another 20% growth for Sydney on top of what is already looking like 10% for 2013. :tu:

Looks like my prediction for Sydney median house price to approach $1M by end of 2015 is starting to gain some support...

Quote:
 
THE recovery in Sydney's residential market will turn into a boom next year, with low interest rates and improved sentiment fuelling a 15 per cent to 20 per cent increase in housing prices, according to SQM Research.

The price growth in Sydney will be more than double that of Perth, the next best performing city where property forecaster SQM forecasts gains of between 4 per cent and 8 per cent.

Average capital city average house prices were set to rise 7 per cent to 11 per cent next year, up from the expected 2013 average 6 per cent to 9 per cent. The forecast assumes an interest rate rise in mid-to-late 2014.

SQM managing director Louis Christopher warned a Sydney housing boom would create a dilemma for the Reserve Bank of Australia, especially if the national economy performed at below average growth.

“Sydney is turning into a beast unto itself,'' Mr Christopher said. “We have strong conviction that the ABS will record 15 - 20 per cent house prices for the year in that city.''
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Black_Dragon
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Shadow
17 Sep 2013, 06:36 PM
Nice work BD. So you're predicting another 20% growth for Sydney on top of what is already looking like 10% for 2013. :tu:

Looks like my prediction for Sydney median house price to approach $1M by end of 2015 is starting to gain some support...

Thank you.

Now isn't it about time you came out of the shadows, Shadow?!
:D
"No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...and if it occasionally gets a little heavier than what you had in mind, well...maybe chalk it off to forced conscious expansion: Tune in, freak out, get beaten."My Webpage
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peter fraser
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Black_Dragon
17 Sep 2013, 06:27 PM
You can find the new report here BTW.

http://www.sqmresearch.com.au/boombustreport.php

Many thanks BD.

Is there anyone at all still predicting a fall in prices in any major centres?

The number of bullish reports is quite scary.

Any expressed market opinion is my own and is not to be taken as financial advice
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Black_Dragon
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peter fraser
17 Sep 2013, 06:40 PM
Many thanks BD.

Is there anyone at all still predicting a fall in prices in any major centres?

The number of bullish reports is quite scary.
Well we do think prices are falling in Canberra and will keep falling next year. As pointed out earlier this year, transactional data is really laggy for the ACT but it should be feeding through to the various aggregate indexes now
"No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...and if it occasionally gets a little heavier than what you had in mind, well...maybe chalk it off to forced conscious expansion: Tune in, freak out, get beaten."My Webpage
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Shadow
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Black_Dragon
17 Sep 2013, 06:39 PM
Thank you.

Now isn't it about time you came out of the shadows, Shadow?!
Perhaps some day. I've generated too many bear enemies over the years to come out of hiding just yet.

Maybe when my ultimate prediction comes true in 2015 I will emerge into the light...

Quote:
 
In SQM’s best-case scenario, which assumes a strong economic recovery and interest-rate increases in mid-2014 or earlier, prices across Australia’s major cities could surge as much as 18 percent on average in 2014, led by price growth as high as 30 percent in Sydney, as much as 15 percent in Perth, 12 percent in Brisbane and 11 percent in Melbourne.
If we do get 30% growth in Sydney in one year (2014) it will be very messy... that would take Sydney straight back up to 2003 levels in price/income ratio terms, and probably overshoot into 2015. Could the RBA allow that to run? The pressure to implement NZ-style macroprudential regulations would be pretty strong. Steve Keen would have a fit.

Quote:
 
Christopher added that the RBA’s decision to lift interest rates will be a difficult one. He noted that the RBA might not lift rates if only a few cities experience growth beyond 7%, unemployment was still on the rise, and if consumer and business confidence was still not doing well.
Very interesting times.

How are MacroBusiness going to handle this?

They've been preaching crash / decade of nominal declines / slow melt for years now... eventually they are going to have to issue a mea culpa.

They really need to apologise to their followers, as does David Collyer.
Edited by Shadow, 17 Sep 2013, 06:50 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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b_b
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Interesting. NZ has shown that any talk of Macroprudential tools will only accelerate the gains as punters rush to beat the regulations.

I think we will get a supply response before then.
Edited by b_b, 17 Sep 2013, 06:50 PM.
(S – I) + (T - G) + (M - X) = 0
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Black_Dragon
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Shadow
17 Sep 2013, 06:46 PM
Perhaps some day. I've generated too many bear enemies over the years to come out of hiding just yet.

Maybe when my ultimate prediction comes true in 2015 I will emerge into the light...


If we do get 30% growth in Sydney in one year (2014) it will be very messy... that would take Sydney straight back up to 2003 levels in price/income ratio terms, and probably overshoot into 2015. Could the RBA allow that to run? The pressure to implement NZ-style macroprudential regulations would be pretty strong. Steve Keen would have a fit.
Yes, in that scenario, 2015 could be messy for Sydney, depending if the RBA panics.

Goldilocks scenario is Sydney at 15% next year, 7% for other cities and lots of FHBs signing up for new homes.
"No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...and if it occasionally gets a little heavier than what you had in mind, well...maybe chalk it off to forced conscious expansion: Tune in, freak out, get beaten."My Webpage
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apex
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Louis, would you mind describing briefly the formula you use to calculate these scenarios, and what's your track record like from previous predictions?

This would be good to know before handing over money for the report. Cheers!

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Black_Dragon
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apex
17 Sep 2013, 07:06 PM
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Louis, would you mind describing briefly the formula you use to calculate these scenarios, and what's your track record like from previous predictions?

This would be good to know before handing over money for the report. Cheers!

Each and every year in our report, we cover off what were last year's forecasts. Where we got it right, where we got it wrong and why. If you know us you will know we are advocates of accountability in this area and loath how the media can have a very short term memory when it comes to wrong predictions.

BTW here is a link to some stories from our 2012/13 report we released this time last year. .You tell me how right/wrong we got it.

http://www.propertyobserver.com.au/residential/australian-house-prices-could-rise-7-in-2013-if-eurozone-holds-together-sqm-research/2012092556806

http://www.moneymanagement.com.au/financial-services/2012/sqm-optimistic-about-housing-market

"No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...and if it occasionally gets a little heavier than what you had in mind, well...maybe chalk it off to forced conscious expansion: Tune in, freak out, get beaten."My Webpage
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