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Co-founder & CEO of AllenWargent property buyers & WargentAdvisory (subscription market analysis for institutional clients).
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Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), and CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).
4 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.
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Friday, 28 February 2014
Lots of gloom around at present, with Qantas shedding jobs, Virgin in the mire, the jobs market looking soft...and the capex data rather horrible!
On the plus side, some big earnings reports from the large companies.
Woolies (WOW) posted an underlying profit of $1.3 billion profit today for the first half, a solid increase of 6%.
To be blunt, job losses and struggles at Qantas and Virgin are very sad - I have mates at Qantas - but ultimately these are small companies in terms of the Aussie economy.
Earnings results from the big players have mostly been pretty good, and this is reflected in the share market being close to 6 year highs.
The Housing Industry Association (HIA) today said that it expects the Reserve Bank to keep interest rates on hold for the whole of 2014.
The HIA also noted that new housing starts are forecast to break the 165,000 threshold for only the 2nd time in a decade, which means that residential construction will begin to play its part.
Credit growth remains far from remarkable, and obviously it is still housing credit leading the way (+5.6% y/y/).
On the plus side, all sectors are now confirmed as being in an upswing, so low interest rates are beginning to impact business and personal credit too.
Unsurprisingly, the net result is that house prices are rising everywhere.
Source: RP Data
However, as I'll get around to analysing, the February data will reveal prices as 'falling' in February in all cities except for Sydney (where preliminary auction clearance rates last week were almost as high as we've ever seen).
Monthly data is hardly reliable, but who knows, maybe things will start to cool across Australia as the year progresses.