Australian property: ripe for international investors.

Written by Chris Nicolas
16th October 2009
The international property market in recent years has been unstable, vulnerable to weakening economies and irresponsible banking systems. Since the Global Financial Crisis (GFC) many developed economies have fallen victim heading into recession with property prices crashing. Australia has defied the odds being the amongst the few developed countries to experience genuine economic growth through this turbulent period.
The Australian property market is well positioned to overide the full impact of the GFC and avoid the path that the US and other formerly competetive property markets have recently experienced. Unlike the US, Australia is experiencing an undersupply of property, the financial system does not have non-recourse loans and has stricter credit policies, unemployment rate has recently decreased from 5.8% to 5.7%,(as opposed to the official predicted 8.5%) and the Australian dollar is on its way up.
With the federal government’s stimulus grant for first-home buyers coming to an end on 31 December 2009 and interest rates set to re-calibrate as a result of a speedy and evidently strong economic recovery, many potential first—home buyers are likely to change their preference back towards renting. This is great news for property investors; with demand easing, prices may become more negotiable, coupled with increasing rent and investment returns.



A recent report by mortgage insurer QBE LMI, which was researched by BIS Shrapnel, has provided a housing outlook for 2010-2012 in Australia. The result suggests that overall, Australian capital city property is set to grow between 12-23% from June 2009 to June 2012 with Adelaide predicted to outperform the nation with 23% growth.
Now is a great time to buy property in Adelaide with unprecedented government investment in infrastructure creating thousands of jobs and having a massive impact on the future property values in regenerated areas.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

South Australia fifth ranked fifth among international mining jurisdictions in ResourceStocks’ 2009 World Risk Survey.

South Australia has continued to excell in mineral exploration spending.

Minister for Mineral Resources Development Paul Holloway says the latest statistics show the State steps into the 4th quarter, with total spending on mineral exploration rising to $41.8 million for the June quarter, up from $36 million during the previous three-month period – a rise of 16.1 per cent.

Combined minerals and petroleum expenditure for the 2008-09 financial year was $332.9 million.

The figures are reflected in South Australia’s fifth ranking among international mining jurisdictions in ResourceStocks’ 2009 World Risk Survey.

“The turnaround in resource exploration expenditure reflects improvement in global commodity prices and South Australia’s determination to continue to increase our State’s economic prosperity through the minerals and energy sectors,” Mr Holloway says.

“Unlike other states, South Australia has not experienced any mine closures as a result of the global financial crisis. During the next 12 months, a further four to five mines are expected to be approved in South Australia, building on the 11 mines currently operating in this State.”

Property prices across Australia are expected to grow significantly over the next three years, as upgraders and investors compete for stock in the same, already undersupplied, property market.



Low interest rates and a shortage of affordable housing, coupled with growth in rental rates, will continue to drive up house prices - despite the threat of higher borrowing costs, according to the QBE Lenders' Mortgage Insurance (QBE LMI) Housing Outlook 2010-2012.

Adelaide, where property is the most affordable, is expected to see the strongest price gains, clocking a 23 percent rise over the next three years.

Ian Graham, chief executive of QBE LMI said the outlook was particularly good for first home buyers who have recently joined the housing ladder, and South Australia's favourable environment will attract greater numbers of solid investors to the market.

"The surge in first home buyer demand is now slowly permeating through to greater demand from upgraders who are trading over to their next dwelling after selling to the buoyant first home buyer market," he said.

"The strong rental environment and stabilisation of prices is also continuing to attract investors into the market."


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Auction Review - 36 Jervois Ave. Magill, Adelaide

SOLD $451,000
3rd October 2009 at 1pm on site
Written by Chris Nicolas
About the Property:
The property is a two bedroom, 1 bathroom original sandstone fronted 1950 Art Deco home. The property is currently leased until 26th November 2009 for $260 per week. The approximately 676sqm allotment appeared to have a slight gradient from the backyard down to the front. Considering the council’s development plan criteria, the zoning requirements stipulate a minimum of 350sqm per allotment. A development of two semi-detached dwellings on this site may be difficult with a non-complying application likely to be necessary. For the successful purchaser it would most likely be desirable to extend and renovate the existing structure rather than redevelop.
Commentary:
The highly skilled auctioneer Phil Harris of Toop & Toop proceeded with the auction at 1pm in reasonably good weather. Many neighbours turned out to watch the event in interest as the bidding started at $390,000. With only three serious bidders, it was evident that the market consisted of young couples and families from different backgrounds.



The bids increased in $10,000 increments until bidding stalled at $440,000, when Phil started to accept bids in $5,000 increments. For one family the bidding exceeded their cut-off point early and at $450,000 the auction was coming to a conclusion with all the bidders at their limits. Phil attempted to squeeze every dollar out of the final two competing parties by calling for additional $500 bids to buy the property. This did not last long and the “fall of the hammer” found a young couple to be the new successful purchasers of 36 Jervois Avenue Magill for $451,000.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Australian property shows 8% growth in 2009

National property values jumped by almost 2 per cent in August in the largest monthly movement since the RP Data-Rismark Home Value Indices began in January 2005.

Using the rpdata.com (ASX: RPX) property database, which is Australia’s largest and includes over 170,000 sales during the first eight months of 2009, Australia’s housing recovery solidified during the month of August with strong capital gains registered across the country despite evidence of slightly decreasing first home buyer numbers.

Home values in Australia rose by an exceptional 1.9 per cent during the month of August. This brings cumulative capital growth in the first eight months of 2009 to a better than expected 7.9 per cent. According to rpdata.com research director, Tim Lawless, the August results surprised on the upside and are indicative of very high levels of buyer confidence combined with low levels of property available on the market.

“These buoyant conditions sit in striking contrast to the same time last year when values were falling in some states, less than half of the auctions held cleared and sales volumes were at rock bottom. We are now seeing home values rising at a solid rate, almost 80 per cent of auctions are clearing, and sales volumes have bounced back significantly”, Mr Lawless said.


Rismark International managing director, Christopher Joye, added, “Australia’s housing market is being underpinned by the strongest population growth since 1971, record housing shortages, historically low mortgage rates, better than expected employment outcomes, and one of the world’s most profitable banking systems.”

Australian home values have now risen 3.8 per cent past their February 2008 peak. This rebound followed peak-to-trough falls in national home values of just 3.8 per cent in 2008, which compares exceptionally well with the 15 per cent and 30 per cent house price declines seen in the UK and US, respectively.

Dispelling concerns that the recovery is limited to first home buyers Mr Joye commented, “In contrast to claims that this is a first time buyer bubble, the cheapest 20 per cent of suburbs in Australia have actually underperformed both the mid-priced market and Australia’s 20 per cent most expensive suburbs since the housing market bottomed in December 2008.”

“As recently noted by the RBA, all major lenders now require a minimum 10 per cent deposit and are applying the strictest credit standards we’ve seen in over a decade. Australian housing credit growth has also been running at levels that are extremely low by historical standards and noticeably less than the growth experienced in the 1991 recession,” Mr Joye said.

Rpdata.com’s Tim Lawless concurred with Mr Joye and said that over the last three months the premium residential market increased in value by 4.5 per cent compared with a 3.4 per cent gain in the middle market and a 2.8 per cent improvement at the cheapest end.
“Despite the strong gains, the bounce in the premium sector has not been enough to offset the peak to trough fall of 9.9 per cent between February 2008 and January 2009.Prices in Australia’s most expensive markets are still 1.1 per cent lower than at their peak.”

Mr Joye added, “While the resounding recovery in Australia’s housing market confirms our forecasts, we expect medium term growth rates to be more measured as mortgage rates normalise back to between 7-8 per cent. This would bring the cost of housing finance back in line with its 2000-01 levels, which is notably well below the searing 9.6% highs endured by borrowers in August 2008 care of the RBA.”

In closing Tim Lawless said that the upward momentum in Australian house prices is a critical economic signal from the market to builders and developers to encourage them to reinvest in producing new housing supply. This was a message reinforced by the RBA’s Dr Anthony Richards in a speech to CEDA yesterday: policymakers need to facilitate significant new investment in housing supply to alleviate Australia’s growing housing shortage, which ANZ and Westpac estimate has risen to around 200,000 homes.


“This price growth will also go a long way to comforting risk-averse lenders to start providing credit again to developers, which has been one of the main bottlenecks on the supply-side. And it will stimulate the reallocation of resources away from other sectors of the economy into much-needed housing investment.” Mr Lawless said.

Other key findings from the August RP Data-Rismark Index results:

Unit values (+2.1 per cent) have marginally outperformed house values (+1.8 per cent) in the month of August. Over the course of 2009, units (+8.5 per cent) have also generated slightly higher capital growth than houses (+7.7 per cent).

Most capital cities recorded robust gains in the month of August with every single city experiencing rises in home values during the first eight months of 2009.

After several years of subdued growth following the end of Australia’s last housing boom in 2003, which saw Australia’s “house price-to-income ratio” fall by nearly 20 per cent through to December 2008, home values in the two major capital cities, Melbourne and Sydney, have led the recovery in 2009 with total capital gains of 11.6 per cent and 8.6 per cent, respectively.

Following Melbourne, Darwin has been the next best performing capital city with growth of 9.7 per cent in 2009. Interestingly, Darwin also continues to deliver the highest rental yields, implying that the market may have room for further growth.

Home values in Canberra (+6.7 per cent), Brisbane (+5.2 per cent), Perth (+4.1 per cent) and Adelaide (+3.1 per cent) have also realised sustained gains in 2009.

As RP Data-Rismark correctly anticipated, residential real estate in Perth has experienced a recovery in 2009 after a period of falling prices since September 2007. While Perth dwellings have recorded 4.1 per cent growth in the first eight months of the year they still remain 3.6 per cent below their September 2007 peak.

National rental yields have softened slightly given the strong capital growth with the gross annualised rental yield for units being 5.1 per cent while house rental yields are slightly lower at 4.3 per cent.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

FIRST- HOME BUYER’S BOOST TO BE PHASED OUT.

From 1 October 2009 the First Home Owners Boost payment, as part of the Federal Government Stimulus Package will be cut in half.
During 1 October – 31 December 2009 an eligible applicant who signs a contract to purchase an existing home will receive an extra $3,500, as opposed to the $7,000 previously. While signing a contract to purchase or construct a new home during the same period will provide an additional $7,000, instead of the $14,000 offered before the 1 October 2009. After 31 December 2009 the Boost payment will cease and only the standard First-Home Owner’s Grant will apply.
Consequently, there is likely to be a ‘Rush’ of first-home buyers entering the market to capitalize on the additional funds before the Boost expires at end of the year. It is likely that during this period there will be hyper-inflated prices in some entry-level properties as increased demand and limited stock availability pushes up prices. Therefore, buyers need to be very cautious of the true value of properties targeted at first-home buyers during this period.


Auctions, especially are going to be difficult to gauge during this time of high emotions with the effective application of real estate marketing methods by experienced sales agents and auctioneers playing on the under researched and/or vulnerable. The best advice is to become market-educated, understand your target areas and the true value of properties without the hype. It is always recommended to get professional advice on building and pest inspections to ensure a sound structure and independent advice from a property professional. If you think you may be eligible for the First-Home Owner’s Grant and wish to capitalize on the Boost then please contact a team member at Direct Negotiations for a free, no-obligation discussion on your options.
Written by Chris Nicolas at Direct Negotiations



If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Le Fevre Peninsula in high demand.

With so many choices for investment, identifying quality investment property locations can be a challenging job for current investors. Project marketers and seminar spruikers push suburbs where they have teamed up with developers, offering far from un-biased opinions on Adelaide’s future ‘hot-spots.’ Helpful relations at weekend barbecues too will offer their ‘expert’ opinions on where you should or should not direct your capital or potential Self Managed Super Fund. One such client, confused and seeking independant advice recently asked our opinion on a western coastal suburb... Osborne.
In terms of investment potential, the Port’s redevelopment and the long-term defence contracts at Osborne will drive property investment throughout most Le Fevre peninsula suburbs.
Semaphore, Exeter, Ethelton, Glanville and Peterhead are particularly in demand in the expectation they will outperform other suburbs, according to UniSA property lecturer Peter Koulizos. These five suburbs were also named by Australian Property Investor magazine recently in a list of the top 100 property hotspots in Australia. My opinion is the entire area will lift as a whole so we are then able to focus on stand out opportunities in the broader Le Fevre area.
Key drivers for growth in the area are the ongoing Port Adelaide regeneration and the $10 billion+ defence projects for the construction of submarines and air warship destroyers on the Port River.
Techport Australia, the evolving naval industry hub based at Osborne in the Port Adelaide area, is home to naval shipbuilder ASC and it's where three Air Warfare Destroyer vessels will be built for the navy at a cost of $8bn, to be followed by a $15bn (some reports say $30bn) enterprise to create 12 new submarines. The facility has state government backing, in the form of $300 million worth of state-owned infrastructure. The supplier precinct for naval defence and related businesses covers 35ha initially, but there are 500ha available for long-term development.
The $8bn project to create three major vessels for the navy is under way, with ships to be delivered in 2014, 2016 and 2017 (with possibly a fourth destroyer to follow). Next in line is the submarine construction venture, Australia's largest defence project. Techport is already home to the Collins submarine support program, a 25-year contract. Outside Techport, but in the Port Adelaide area, new port infrastructure is to be developed by BHP Billiton to support its massive expansion of the Olympic Dam mine at Roxby Downs. Already awarded are a $40m contract with BAE Systems Australia (satellite communications), a $10m project with Babcock Strachan & Henshaw (torpedo launch tubes) and a $40m deal with Raytheon Missile Systems.

Much of the defence work at Osborne will require skilled workers and many of them will come from overseas. The state government expects the naval defence work to lift the state's defence workforce from 16,000 to 28,000 within three or four years. As most people generally want to live close to where they work, suburbs in and around Osborne will be in high demand.

So in summary, the factors suggest this area will perform positively. We encourage all of our clients to remain logical and seek independant unbiased advice before committing to major property investment. For advice on what opportunities we currently see arising in the Adelaide market, call Ben Ottewill at Direct Negotiations for a no-obligation chat.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Adelaide's Northern suburbs proposed master plan

A RECREATIONAL saltwater lake, a new marina and an 11km waterfront precinct are proposed as part of a redevelopment of the Dry Creek salt pans north of Adelaide.
Owner of the site, Ridley Corporation, has announced it will forge ahead with plans to develop the plains into a mixed-use urban development to house 20,000 new residents.
The project is being investigated in co-operation with Delfin Lend Lease – the developer behind Mawson Lakes – and the Land Management Corporation, which owns much of the surrounding land.
While the cost of the development has not been determined, the project is 30 per cent bigger in area than the $1.5 billion Mawson Lakes development and will house twice as many people.



Ridley said a preliminary master plan prepared with Delfin Lend Lease had been completed as part of a feasibility study and included:
A DEVELOPMENT area of 980 hectares.
10,000 DWELLINGS housing more than 20,000 residents.
11 KILOMETRES of developable waterfront land.
A 40 HECTARE town centre and mixed-use precinct.
TWO neighbourhood precincts.
A 120-HECTARE saltwater recreational lake with ocean access and marina facilities.
CREATION of dedicated areas for new mangrove habitats and wetlands.
City of Salisbury manager Stephen Haines said it would be an enormous boost to the northern suburbs.
"This proposal will bring support to our commercial centres, it will provide employees for the many jobs being created out here and it will be a boost to the university and schools in this area," he said.
The second phase of Ridley's feasibility plan will be completed by December this year, and the LMC said it expected to provide the State Government with an interim report on the development early next year.


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Norwood Auction

I have just returned from a Fri 11.30 am auction in Sydneham Road, Norwood. The property was quoted at $385,000. A circa 1870 freestanding cottage in the heart of Norwood on a relatively small allotment. There were approximately 30 registered bidders and about 100 people attending the auction. The bids opened at $425,000. (much to the dismay of 27 bidders!)Three remaining bidders assisted in bringing the hammer down in the 450k region.


Direct Negotiations rendered reports and cross referenced through various avenues and estimated this to be very close to the real value on the day. The market is moving along very well, and properties are selling quickly. The market is realistic. Properties are selling when priced accurately. There is huge demand for quality properties from local, interstate and offshore purchasers. The key is to be prepared with correct and up to date information in order to make clear investment choices.

DID YOU ATTEND THE AUCTION? WHAT ARE YOUR THOUGHTS?

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, we guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Underquoting in South Australian real estate

It has started creeping back into the Adelaide residential real estate market...
UNDERQUOTING.-
I will very brieftly explain the changes that were imposed by REISA on the South Australian real estate industry. The document is about 40 pages. This is a summary on pricing.
Revised regulations came into effect in July 2008. The addtional laws were designed to curb pricing irregularities. In the sales agency agreement the document must specify the agent's genuine estimate of the selling price of the property. The price can be expressed as a single figure (e.g. $400,000), or a price range. A price range must be specified by nominating upper and lower values. The upper value must not exceed the lower value by more than 10%. That is to say, if the lower value is $400,000 then the upper value can not be higher than $440,000. The lowest quoted amount in a price range,represents the lowest amount of money that the vendor (seller) stated that he/she would accept in payment for the property.

Potential home buyers and investors are lured into thinking they have a genuine opportunity of securing the property based on the agent's relatively understated price indication. The purchaser proceeds to expend time, money and emotion, including building & pest inspections, strata inspection reports, architects for renovations, solicitors & conveyancers, council searches and deposit money preparation to finally discover that they never had a chance of being successful & the seller wouldn’t have ever accepted the price that was originally quoted by the agent. The price was simply used to ‘bait’ their interest.
This method of underquoting attracts a lot of buyers to ‘sale by negotiation’ as well as auctions. Mislead purchasers create a sense of excitement in the early stages, while the more astute and well informed buyers attend with a plan, a budget and primary/seconday information required to accurately evaluate the offering.



The majority of agents originally took these regulations quite seriously.
The market has been bouyant in the lower - medium sector. Median home values in South Australia have risen during a very turbulant eighteen months. There has been a lot of confusion about global property values, particularly to those who have listened to the media without the consultation of primary or secondary research.
A real estate agent may make first contact with a vendor years before the property goes to market. The sales process involves the agent keeping in touch and giving updates as to market influences and pricing.- Some do this more effectively than others.
If an agent quotes a price to a vendor a year prior to listiing, then takes a month to start the sales campaign, and another month to sell, then after 14 months, the price will have adjusted, sometimes by 15%, taking into considerations that over 10 suburbs have risen over 38% in the last 2 years.
The vendor and agent may advertise the home a little over the original agreed value as of 14 months prior. The purchasers inevitably flock to an obvioulsy underpriced property and climb over each other to throw offers at the agent. When there are dozens of interested parties, then emotion dominates (even with entry level investors) and the price is driven up above genuine market value. This is known within the industry as "feeding the greed"
There are some agents who, for no reason other than to deceive, deliberately underquote or "lowball" the stated value - Especially in the case of auction.

Have you experienced blatant underquoting?
Have you been influenced to pay a considerable amount of money above the original stated asking price for a property?
We'd like to hear about it...

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

A brief history of Adelaide . Part 1/3

Colonel Light’s original plan for the 100 of Adelaide and its belt of parklands became the fundamental benchmark in Adelaide's planning in the post-war years. Work on the plan began in the late 1950’s. By 1959 interim recommendations were being considered and the final printed plan and illustrated report were submitted to State Parliament in 1962.



Adelaide in the late 1950s had a population of just over half a million. There was little urban development north of Gepps Cross, but the first houses were being built at Elizabeth. Tea Tree Gully was still rural and development did not extend south beyond Darlington. Migrants were flooding in. The population was increasing at 18-20,000 a year and metropolitan Adelaide had become the third largest and fastest growing city in Australia.
University students, women’s organisations and others became involved in basic surveys for the Plan and a small enthusiastic staff was engaged. It was thought feasible to plan for 20 to 30 years ahead to assist public utility and transport authorities. Forecasting future population is a hazardous task, but it was estimated that a million was likely by 1981 and many more by 1991.

A sudden downturn in the rate of population growth in 1970s resulted in the million figure not being passed until the turn of the century.



The hills limit Adelaide’s expansion to the east and the sea to the west, forcing expansion north and south. The most suitable land for urban development to the north lies on the plains nearer to the hills. Elizabeth had been planned with a town centre similar to the British new towns being built at that time and this form of development was thought to be adaptable for Adelaide’s expansion.


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

A brief history of Adelaide . Part 2/3

Decentralisation, satellite towns, tall blocks and higher densities had little chance of acceptance. Tea Tree Gully and Noarlunga developed later with their own major centres. The opportunity to establish a satellite town came in the early seventies; a site was obtained at Monarto and a development corporation established. Forecasts of reducing population growth caused its demise, giving additional impetus to Adelaide’s future northerly and southerly expansion.

New routes would be required to the north, northeast and south enabling unrestricted movement of people and goods; a system of freeways, major roads and rail extensions were proposed. These proposals needed more detailed investigation, as major land acquisition would be involved. American consultants were engaged and the resulting Metropolitan Adelaide Transportation Study (MATS) took place in the 1960s. Its recommendations included additional freeway routes and a rail subway under King William Street. The study caused widespread concern as individual properties on all the new routes could be identified. Some routes were dropped but others were retained.



The O’Bahn now operates on the original route proposed to Tea Tree Gully. To the north new routes have been established with links to Port Adelaide; to the south the Expressway extends to the Onkaparinga and the railway has been extended to the Noarlunga Centre. Land was being purchased for the important but controversial north-south connecting route through the western suburbs, but the proposal was finally abandoned in the 1980s. This has meant a continuing increase in traffic on the inadequate South Road.

New parks and recreation areas were necessary near where people were to live and secured long before the need arose. The plan recommended a means of financing their purchase. Subsequently the amount of land for open space was increased when land was divided into allotments and money from small divisions and strata titles paid into a special fund. An unexpected source of federal funds enabled almost all the land proposed as open space to be obtained by 1977.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

A brief history of Adelaide . Part 3/3

At the end of the 1950s the State’s economy was evolving from a dependence on primary production towards an economy based on manufacturing and service industries. Port Adelaide and the north-western suburbs were the traditional location of industry and have continued to be so. There was a brief flurry of expectancy in the 1990s when land near the port was selected as the site for Australia’s hi-tech Japanese Multi Function Polis. Industrial sites were being provided in Elizabeth and there was other suitable land in Salisbury. To the south, industry was already located along South Road, an oil refinery was to be built south of Hallett Cove and adjacent land was thought suitable for industry.

Speculative post-war subdivision was resulting in unmade roads and inadequate services. The development of Elizabeth set a new pattern to be followed by developments such as West Lakes, Golden Grove, Seaford and Mawson Lakes; all with landscaped roads, shops, schools and open spaces.




In the 1950s there was strong public attachment to single storey houses on spacious allotments and acceptance of closer living to reduce servicing costs seemed unlikely. Over the following years single person households have increased, smaller lots created and apartment living accepted.
The high costs of servicing the steep land overlooking the city provided a sound economic reason for limiting development and thus preserving its natural beauty. The Hills Face Zone has remained relatively unscathed for several decades, but its retention needs constant vigilance.



The most noteworthy outcome of the 1962 Plan’s recommendations has been that planning has become an integral part of State and local government administration with departments serviced by professional staffs and public appeal rights against adverse decisions. Fifty years is a short time in the life of a city. Others than someone involved with the plan’s preparation will judge whether it maintained Adelaide’s reputation as “a monument to far sighted town planning”.



If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Adelaide housing shortage to intensify

ADELAIDE will need almost 30,000 new houses in the next five years to keep up with an escalating population, a new report shows.

The Australia On The Move report, released yesterday, forecasts Adelaide's population to increase by 18 per cent – or 213,823 – by 2027.

The Residential Development Council and Matusik Property Insights report reveals Adelaide will need an extra 5856 houses every year for five years.

The forecast is higher than an 2001 report, conducted by demographer Bernard Salt, which said Adelaide needed 5113 new houses each year between 2001 and 2011 and 3788 every year after that until 2031.



Residential Development Council executive director Caryn Kakas said the Australian population was expected to explode. That will certainly add stress to the Adelaide housing supply and demand deficit.

"Limited supply and rising demand can only lead to one thing: rising prices. And rising prices means less affordable housing," she said.

The report shows Adelaide's current estimated residential population is 1.18 million. That is expected to increase by more than 200,000 by 2027.

South Australia's population is forecast to grow by 17 per cent to 1,898,754. Australia's population is anticipated to increase by almost six million people within 20 years which means at least 155,000 houses per year during that period will be required.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

South Australia Honeymoon Mine JV is in the Yellow

Japan’s Mitsui and Canada’s Uranium One have reached a milestone in their development of the $118 million state-of-the-art Honeymoon uranium mine.

Construction began in April on the mine in South Australia’s north-east, 37 years after yellowcake was first found at the site.

Premier Mike Rann has congratulated the Honeymoon joint venture as the first foray by a Japanese investor into Australia’s uranium mining industry.

“Honeymoon will be capable of producing about 400 tonnes of uranium oxide a year, worth about $80 million to South Australia’s tally of annual mineral exports,” Mr Rann says.



The mine is one of the many projects proceeding in South Australia’s resource industry.

Mineral Resources Development Minister Paul Holloway says four or five mines are expected to be approved in the next 12 months, building on the 11 operating in the State now.

Among them is the Jacinth-Ambrosia mineral sands project, which is on track to begin operations in 2010, while the proposed Olympic Dam expansion took another step toward fruition with the release of its environmental impact statement in early May. Submissions will be received until 7 August.

South Australia’s resources sector remains strong despite the downturn in mineral exploration spending reflected in the latest Australian Bureau of Statistics figures.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

South Australian international student intake up 24%

South Australia’s international education industry continues to defy the economic downturn by outstripping the national average to record a 24% jump in overseas student enrolments in the first three months of 2009.

Employment, Training and Further Education Minister, Michael O’Brien, says the latest Australian Education International (AEI) figures emphasize the resilience of international education in the face of the global financial crisis.

“It’s up to 30% cheaper for many Asian students to study in Adelaide this year due to the lower Australian dollar,” Mr O’Brien says.

“That’s reflected in the 24.3% hike in enrolments we’ve recorded so far in 2009 – our strongest growth rate in seven years.

“If that growth continues, we are on target to attract a record 32,000 international students by the end of the year,” Mr O’Brien says.

Nationally, AEI figures show that international student enrolments rose 20.8% in the first three months of 2009 – pouring more than $15 billion into the national economy.

Mr O’Brien says the continued buoyancy of South Australia’s $741 million international education industry is no mere accident.

“South Australia’s university and training providers must be commended for their highly professional international office marketing and recruitment programs.

“And we don’t just reap financial benefits: our education providers are helping to teach the next generation of Asian leaders, which in turn enhances their understanding of our language and culture and fosters closer ties with South Australia.”

‘The State Government is also providing $500,000 for primary and high school fees to be waived for the dependants of international Higher Degree by Research students studying at South Australian universities.

“This is a positive initiative coming from next week’s State Budget, which will rectify the disadvantage we have faced against other states offering fee waivers.

“This fee waiver only applies to Higher Degree by Research students who are sponsored by scholarships from their home countries.

“The scheme, to be funded over four years, will boost university efforts to attract the brightest students from countries such as Malaysia, Vietnam and the United Arab Emirates.

“The decision means we will be in a position of parity with our major interstate competitors and it provides an opportunity to expand our research and innovation base,” Mr O’Brien says.

Commencements in South Australia grew 21.1% to the end of March, compared with a national average of 18%.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Adelaide house prices 2009

Australian home values recorded a healthy 2.8% increase over the first four months of 2009

The RP Data/Rismark Australian Home Value Index out today confirmed that housing values around Australia rose by a healthy 2.8 per cent over the first four months to April 09—virtually wiping out the price falls seen in 2008 according to RP Data National Research Director Tim Lawless.

Over the first four months to April 09, every mainland capital city apart from Perth recorded an increase in home values with the most significant gains in Darwin (+5.3 per cent), Melbourne (+4.4 per cent), and Sydney (+3.9 per cent).

The recent growth in the Australian residential property market has fuelled speculation about a ‘bubble’ developing in the first home buyers market but RP Data’s Mr Lawless believes these claims are largely unjustified.



“Home values in Australian capital cities mortgage belts, which are the prime first home buyer markets, were flat or falling between 2004-07 while the inner city and affluent markets enjoyed consistent growth. In 2008-09 we have seen a reversal of these fortunes,” he said.

Mr Joye adds “While first-time buyer activity has certainly supported the market, people forget that 70-75 per cent of home buyers are not first timers. Also, lending standards are more conservative today than they have been for over 15 years with maximum borrowing ratios being consistently reduced.”

The return to capital growth comes as weekly rental rates start to level.

Mr Lawless said, “Rental rates across Australia have powered ahead over the last three years, providing the best gross rental yields investors have seen for a long time.

“We are now seeing growth rates for weekly rents start to level due to decreasing rental affordability which is causing many renters to consider buying a home instead of renting.

“Gross rental yields are likely to peak over the coming months suggesting that now is probably the best time for investors to roll up their sleeves and become active,” he said.

In terms of housing stock, units are continuing to outperform houses where over the first four months of 2009 values increased by 3.3 per cent while house values increased by 2.7 per cent.

In closing Mr Lawless said “The stronger performance of the unit market is due to a number of factors. Comparing median house and unit values nationally, the price gap between is just over $90,000, so the value proposition of a unit is very compelling. Additionally, units are generally located closer to the city and along transport spines which is very appealing to many Gen Y and Gen X buyers,” he said.

The monthly Australian capital city home value changes are as follows: January (+0.1 per cent); February (+1 per cent); March (+0.6 per cent); and April (+1 per cent). The April index results are indicative and may be subject to small revisions.


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

First contract awarded to Adelaide firm in Federal Governments $300bn defence plan

A battery-manufacturing company from Adelaide's western suburbs has been awarded the first contract to work on research and development for 12 planned new submarines.
Pacific Marine Batteries has hired 20 engineers and technicians to design a battery that may be used to power the new submarines.

The South Australian Premier, Mike Rann, says the research and development contract for a battery is an important one.

"At the moment each Collins class submarine carries about 450 tonnes of batteries, but the next generation of submarines is going to need about 650 tonnes of batteries and they're going to have to have a longer life, because the new submarines are going to have a longer range and are going to spend longer under water," he said.



The state's hi-tech defence and ship-building industries would benefit from billions of dollars of weapons purchases including new warships, fighter jets, and manned and unmanned spy planes proposed to be based at the Edinburgh RAAF base.

Billions of dollars and thousands of jobs are earmarked for South Australia in the Federal Government's $300 billion defence contracts plan.

The plan for defence equipment across the nation includes:

100 stealth jet fighters,
EIGHT new frigates,
20 fast offshore combat vessels,
SIX heavy landing craft,
66 new helicopters,
EIGHT maritime patrol planes,
A 15,000-tonne supply ship.

The army's expansion has been set in stone and the new Adelaide-based battalion and all the ancillary works associated with it will now proceed.

Bigger salaries, conditions and housing for the Australian Defence Force's 55,000 uniformed personnel is also provided.

SA Premier Mike Rann says it will secure thousands of jobs and years more shipbuilding work in Adelaide.

"This is the cream on the cake for us and also guarantees another massive project to follow the air warfare destroyers project," he said.


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

BHP Billiton Olympic Dam expansion - Shot in the arm for South Australia

BHP Billiton is seeking the approval of the Australian, South Australian and Northern Territory governments for a significant expansion of its existing mining and processing operation at Olympic Dam in northern South Australia.

Located 560 kilometres north of Adelaide, South Australia, Olympic Dam is a multi-mineral ore body. It is the world's fourth largest remaining copper and gold deposit and the largest known uranium deposit. It also contains significant quantities of silver.

The proposed expansion would be a progressive development, requiring construction activity over a period of 11 years. The project schedule ultimately will depend on the timing and nature of government approvals and the final investment decision of the BHP Billiton Board.

BHP Billiton has announced plans to turn its Olympic Dam mine in South Australia into the largest open cut on earth.

A 4600-page environmental impact statement, released by the company May 1, 2009 , set out an ambitious timetable for the conversion of the copper, gold, silver and uranium mine from underground to pit operations.


Work would start as early as April 2010 on the multi-billion-dollar upgrade.


Under BHP Billiton's best-case scenario, excavation of the 1km-deep mine pit, and possibly construction of a pipeline to supply a gas power plant, would be under way by July next year.

By that time, a mini-city known as Hiltaba Village would be rising in the desert to house the thousands of workers needed for the project. This would be in addition to the expansion of the existing township of Roxby Downs.

The mine's workforce would double from 4000 to 8000 when it reached full capacity, with 2500 additional houses to be built for permanent workers. The operation representing the world's biggest single producer of uranium and one of the biggest of copper.

The open cut envisaged by BHP Billiton at Olympic Dam would become the biggest man-made hole on the planet and yield $1 trillion worth of ore over its century-long life, more than $200 million per annum of which would be paid in royalties to the South Australian Government. Production would lift six-fold from 12 million tonnes of ore annually to 72 million tonnes after 2020.

"We will work with BHP Billiton to maximise the number of jobs here in South Australia" The South Australian Premiere, Mike Rann said.

South Australian Mineral Resources Development Minister Paul Holloway yesterday said the Government was not blinded by the wealth on offer at Olympic Dam.

"If there are issues we do not believe have been addressed properly, then we will ask BHP to reconsider them and make appropriate amendments," Mr Holloway said.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61(0)8 84631997

How did we get here?

While on his morning walk, Prime Minister Kevin Rudd falls over, has a heart attack and dies because the accident and emergency dept at his nearest hospital is too understaffed to treat him in time.

So his soul arrives in Heaven and he is met by Saint Peter at the Pearly Gates. 'Welcome to Heaven,' says Saint Peter, 'Before you settle in, it seems there is a problem. We seldom see a Socialist around these parts, so we're not sure what to do with you.'

'No problem, just let me in; I'm a good Christian; I'm a believer,' says the PM.
'I'd like to just let you in, but I have orders from God. He says that since the implementation of his new HEAVEN CHOICES policy, you have to spend one day in Hell and one day in Heaven. Then you must choose where you'll live for eternity.'

'But I've already made up my mind. I want to be in Heaven,' replies Rudd 'I'm sorry .. But we have our rules,' Peter interjects. And, with that, St.
Peter escorts him to a lift and he goes down, down, down ...all the way to Hell.

The doors open and he finds himself in the middle of a lush golf course.
The sun is shining in a cloudless sky. The temperature is a perfect 22C degrees. In the distance is a beautiful club-house. Standing in front of it is Gough Whitlam and thousands of other Socialist luminaries who had helped him out over the years --- Bob Hawke, Paul Keating, etc. The whole of the Labour Party leaders were there ..

Everyone laughing, happy, and casually but expensively dressed.
They run to greet him, to hug him and to reminisce about the good times they had getting rich at the expense of 'suckers and peasants.'

They play a friendly game of golf and then dine on lobster and caviar. The Devil himself comes up to Rudd with a frosty drink, 'Have a tequila and relax, Kev!'

'Uh, I can't drink anymore; I took a pledge,' says Rudd, dejectedly.
'This is Hell, son. You can drink and eat all you want and not worry and it just gets better from there!'
Rudd takes the drink and finds himself liking the Devil, who he thinks is a really very friendly bloke who tells funny jokes like himself and pulls hilarious nasty pranks, kind of like the ones the Labour Party pulled with their master strokes on Education, Immigration, Petrol prices, Tough on Crime promises.

They are having such a great time that, before he realises it, it's time to go. Everyone gives him a big hug and waves as Rudd steps on the lift and heads upward.

When the lift door reopens, he is in Heaven again and Saint Peter is waiting for him. 'Now it's time to visit Heaven,' the old man says, opening the gate.

So for 24 hours Rudd is made to hang out with a bunch of honest, good-natured people who enjoy each other's company, talk about things other than money and treat each other decently. Not a nasty prank or short-arse joke among them. No fancy country clubs here and, while the food tastes great, it's not caviar or lobster. And these people are all poor. He doesn't see anybody he knows and he isn't even treated like someone special!

'Whoa,' he says uncomfortably to himself. 'Gough Whitlam never prepared me for this!'
The day done, Saint Peter returns and says, 'Well, you've spent a day in Hell and a day in Heaven. Now choose where you want to live for Eternity.'

With the 'Deal or No Deal' theme playing softly in the background, Rudd reflects for a minute ... Then answers: 'Well, I would never have thought I'd say this -- I mean, Heaven has been delightful and all -- but I really think I belong in Hell with my friends.'

So Saint Peter escorts him to the lift and he goes down, down, down, all the way to Hell.
The doors of the lift open and he is in the middle of a barren scorched earth covered with garbage and toxic industrial wasteland, looking a bit like the eroded, rabbit and fox affected Australian outback, but worse and more desolate.

He is horrified to see all of his friends, dressed in rags and chained together, picking up the roadside rubbish and putting it into black plastic bags. They are groaning and moaning in pain, faces and hands black with grime.

The Devil comes over to Rudd and puts an arm around his shoulder.' I don't understand,' stammers a shocked Rudd, 'Yesterday I was here and there was a golf course and a club-house and we ate lobster and caviar and drank tequila. We lazed around and had a great time.. Now there's just a wasteland full of garbage and everybody looks miserable!'

The Devil looks at him, smiles slyly and purrs, 'Yesterday we were campaigning; today you voted for us!

First Home Owners Grant boost to end June 30

Q: Who are Direct Negotiations?

A: The Direct Negotiations team is Adelaide’s leading property buyers agents. We don’t sell property, we buy it on behalf of local, interstate and overseas clients.

Q: What are the principal points of the Direct Negotiations business that make it different from others?

A: We act totally independently on behalf of the purchaser. Our team’s background extends across property acquisitions and consulting, finance, building and construction, commercial property, development and wealth creation. We are in the best position to mitigate risk and assist in making the right choice for investors and home owners to meet their requirements on all types of property.


Q: Is there growth in any particular areas?

A: Many areas, that were traditionally less desirable because of difficult access, surrounding zoning or lack of public transport are now being rearranged. The long list of new infrastructure projects both projected and under construction, have enabled us to identify areas of growth due to the ripple effect, access to modern facilities and changing lifestyles.


Q: What is the best type of property to buy?

A: Choosing the right investment property for your individual circumstances and goals requires a thorough understanding of the key principles and dynamics of investment property. Whether you need to isolate niche areas offering strong future capital growth potential, homes providing effective tax depreciation, strong rental yield, or subdivision/development opportunities for immediate equity, all depends on your short and long term goals and your current position. An individual strategy is devised for each client to match their unique circumstance.

Q: How do you see the South Australian market at present?

A: South Australia offers some of the nation’s most affordable housing and most appreciable assets. Adelaide’s median house price is significantly lower than that of Sydney, less than Perth, Melbourne and Darwin. This means you can own your own home or investment for a lot less – or alternatively, buy more property for the same money. House prices are stable and strong capital growth is on the horizon with our mining and resource deposits, unprecedented skilled immigration levels and massive injection of cash for infrastructure. This potential, makes Adelaide real estate currently and looking towards the future, one of the world's most stable investment vehicles.

Q: Any advice for first home buyers?

A: It is vitally important to be educated and well informed before undertaking to commit to potentially the biggest financial decision of your life. Your first home is your first investment property and it’s crucial you make the right choice in terms of property, location, and paying the right amount. A buyer’s agent is a valuable ally to first home buyers, walking them safely step by step through the entire process. With the increased grant potentially only being offered until 30th June this year however, time is of the essence!

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ or call the team on +61 (0)8 84631997

Houses in Adelaide selling before first open inspection

Many potential property buyers are getting frustrated. Adelaide properties that are advertised for sale are commonly already under contract before the buyer has the opportunity to view. This is frequently the case with properties at and under the $400k AUD price range.
Through our networks and databases, we are alerted to properties before they are available to the public. Direct Negotiations purchased several properties this week before the signboard was put on the property.
Last night I organised a private inspection of a particular property that was later to be presented to the market. The agent asked if I didn't mind if a couple of interested groups came through at the same time. There were, in fact seven groups pushing their way in the door. The property lived up to expectations and every single group walked out the door full of anticipation with a "letter of offer" form. What they did not realize was that I had already prepared a contract, complete and signed on behalf of my (off shore) client, with the right price and conditions (negotiatiated prior to inspection). Vendors agreed and signed. The property was under contract to Direct Negotiations.
This morning there were likely be at least four letters of offer being submitted for a property that was sold before they actually walked through the front door.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ , or call the team on +61 8 84631997

Real property in super.

An unfortunate consequence which has occurred as a result of the stock market crash is that many hard working people who require retirement funds, associate the term superannuation with shares, the stock market and huge risks/losses together with commissions and ongoing ‘trails’ to financial planners.
Many of these persons also think that by putting their hard earned cash into superannuation that it has to go into the stock market linked investments and that they immediately lose control and at the same time will be subject to fixed and ongoing fees from financial planners.
Nothing is further from the truth!
A superannuation fund, in most cases is the best ‘investment vehicle’ people can use to accumulate a secure retirement income.
This is why………….
Superannuation funds accomodate better tax breaks than any other ‘investment vehicles’. During the ‘accumulation mode’ the maximum income tax is 15% or 31.5% less than the top tax rate including Medicare.
Capital gains tax for profits on assets held for longer than 12 months in a superannuation fund is 10% and does not attract Medicare surcharges as compared with the top personal taxation rate of 46.5%. Benefits from Salary Sacrificing into superannuation in some cases can reduce personal tax during the accumulation mode in some cases (dependent on individual circumstances) to nil thus saving 46.5% tax.
Superannuation funds with the use of warrants, can now purchase property without the need to have the entire purchase price together with stamp duty at the time of purchase. That is to say they can gear real estate investments.
Prior to the stock market crash, many people had a vast percentage of their wealth invested in stocks and shares via their Superannuation.
The current prevailing attitude towards superannuation-while totally understandable, is foundered by fear and frustration must be put to rest by accountants and superannuation professionals in an effort to protect the workers from incurring even more financial loss and pain.
Legislation is available to enable all tax payers to put away money for their retirement at world competitive taxation rates. The legislators obviously have done their part. Its now up to the investment advisors to ensure that savvy investors have a comfortable retirement by stepping up and doing their part and advising people of their options so that those who want to invest our superannuation into investments other than stocks and shares, such as direct property, have the choice to do so.
Superannuation now offers distinct alternatives.

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ , or call the team on +61 8 84631997

First home buyers battle the investors in Adelaide.

Adelaide remains within the top 10 real estate locality performers WORLDWIDE.
The median Adelaide house price remains at a relatively affordable $373,000.
With all the turmoil in investment markets over recent months, many
investors will be asking if they have done the right thing by investing
in shares or managed funds. Many will be looking cautiously towards
bricks and mortar in 2009 as a potential safe-haven for their
investment dollar.
While some see the current global economic crisis as a reason to
despair, the reality is the current local property market has an
abundance of opportunity ripe for the picking... if you know where
to look.
Just about anyone can make money when the market goes up, but
only skilled, properly informed and educated investors will make
huge profits as skill supersedes luck.
The secret to successful investing is a counter-cyclical approach・
Traditionally, human nature tells us to invest when markets are going
up and to sell when markets are in decline. However, we need to
change our mindset and avoid the herd mentality'・instead, invest
when everyone else is selling (giving us maximum choice, discounts
and negotiating power) and sell when everyone else is buying.
Similarly with longer term investments, we should be buying when
markets are down and hold on to our investments for the long term.
Time in, not timing.
Warren Buffett is quoted as saying:
be fearful when others are greedy and to be greedy only
when others are fearful.・
The world's most successful investors make their money by buying in
the gloom and selling in the boom. To fully understand the current
market and how to profit and make the right decisions for your
investment portfolio, now more than ever you need sound coaching
and advice.
The problem is - where do you turn for help and good advice?
That's where Direct Negotiations can help. Unlike real estate agents and
spruikers/seminar holders, we won't ever try to sell you a property.
Instead, we'll provide you with un-biased independent advice,
comprehensive research, and guidance to ensure you select the
right investment, in the right area, at the right price.
Whether you're a novice or seasoned investor, we can help you wade
through the myriad of land mines in the property market, and see
you on your way to stability and success in 2009!

If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ , or call the team on +61 8 84631997

Just keeping it real

Capital City Performance
Annual change in dwelling value – year ending August 2008

The national end of month property indices report released
today by RP Data & Rismark International confirms that the
supply and demand imbalance currently being experienced in
the Australian property market has placed a floor under housing
prices, resulting in minimal value falls.
Based on the analysis in the report, this is most evident in the
metropolitan areas around the country where record
national dwelling values remaining positive over the 12 months ending August 2008. Over the three months to August 2008
there was a modest overall national decline with property values down by just 0.96 per cent over this period.
population growth has not been accompanied by new dwellings
to satisfy the housing demand.
According to RP Data National Research Director Tim Lawless
the property market has proven to be remarkably resilient with
Mr Lawless said the recent figures should put to rest claims that Australia’s property market is headed for a crash.
“In fact, values are holding relatively firm particularly when compared to the benchmark equities S&P/ASX 200 Index which
dropped by 19 per cent between January and August,” he said.
The only capital city to record a material decline in property values was Perth where this market fell by 5.69 per cent over the
August 2008 period. While this fall in values has caused some distress for home owners, Mr Lawless reminds owners that the
results need to be placed into context where values increased by 13.9 per cent annually over the past five years.
One of the most interesting findings in the indices release today was the convergence of the capital city market dynamics over
the past six months which revealed that all capital cities recorded slightly negative growth; no particular city was significantly out
of step with the others.
According to Rismark International’s Dr Mathew Hardman “Clearly, the observable phenomenon of the two‐tiered markets in
Sydney and then in Melbourne and to a lesser extent in Brisbane and Perth has disappeared ”
Sydney and then in Melbourne, and to a lesser extent in Brisbane and Perth, has disappeared.
“Market movements are now similar across all metro areas rather than value falls being isolated within the mortgage belts. This
balancing can be attributed to the squeeze the more affluent markets are experiencing due to the turbulence in the financial and
equities sector.
“Looking towards the next six months, strong excess demand in most capital cities is creating a floor under property values,
making large falls unlikely,” Dr Hardman said.
According to RP Data, with population growth projected to remain high and interest rates falling, the demand/supply imbalance
is expected to protect the market from any major falls in property values.
Rismark International’s Dr Hardman believes that unemployment is not a major factor driving property prices; affordability,
excess demand and market momentum are far more significant he said.
“Although unemployment is rising, unless it grows rapidly to significantly greater levels, eg 6 or 7 per cent over the next couple
of years, excess demand will eventually outweigh affordability constraints and begin to push property markets upwards again,
probably by the second half of 2009.”
“Over the long term, home unit values tend to track GDP growth, while house prices exceed it by approximately 2 per cent. In
Sydney, house and unit values relative to GDP have returned to their pre 2000 levels so affordability is slowly returning to the
Sydney market,” Dr Hardman


If you are looking for a well performing residential or commercial investment property, an addition to your existing property portfolio or a home to live in, We guarantee to save you money on your next real estate purchase. Go to http://www.directnegotiations.com.au/ , or call the team on +61 8 84631997