Pete Wargent blogspot

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.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he is one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete Wargent is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

"Pete's daily analysis is unputdownable" - Dr. Chris Caton, Chief Economist, BT Financial.

Sunday, 31 May 2015

Weekend reads

Weekend reads

Catch up on the most interesting reads of the week, summarised by Michael Yardney at Property Update here.


You can also subscribe for the free Property Update newsletter here.

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Sydney market accelerates

If I've read one article about a Sydney property market slowdown over the past two years, I must have read a thousand.

The latest call has been that a decline in transaction volumes must mean that the market is set to decline.

As noted here previously, the only way one could arrive at that conclusion could be if you've never been in the Sydney market (or, for that matter, never been to Sydney).

Auctions and viewings have been packed out relentlessly, with queues consistently out the door and round the corner.

"Slowdown"?

The reason for the "slowdown" in volumes is a woeful dearth of stock on market, with anything half decent being pounced upon by buyers.

We have reached an awkward stalemate situation whereby owner-occupiers are unprepared to list property due to there being nowhere to move to, while investors have become unprepared to sell due to rising prices.

Of course, this will change in time with more listings expected over the months ahead.

But for now there is a major imbalance in the market, which is pushing prices northward apace.

The population of Greater Sydney is now well over 4.8 million and rising, yet there are fewer listings than in Melbourne, Brisbane and even Perth.

 

Only 17 per cent of capital city listings nationally are in Sydney, which is painfully low.



Imbalance

Yet the data sets I have analysed here previously of mortgage finance and investor lending finance shows that record mortgage volumes are being written in New South Wales at the present time.

There is no slowdown in the Sydney market.

If anything, activity that I have seen in the past few weeks has implied an acceleration.

Yesterday's median auction price in Sydney was an extraordinary $1.18 million.

Of 657 reported auctions for the week, 597 sold under the hammer, giving a preliminary auction clearance rate of well over 87 per cent.

They figures may or may not be revised down to the low-to-mid 80s range in due course, but any way you look at it, it's a boom-time market.

Scrolling through some of the example sales reveals some blistering results in the inner suburbs in particular.

This is essentially as high a range for auction results as we have seen in Australia - all-time record levels. 

"Hat tip" to the one commentator who has consistently called this Sydney property cycle accurately: Louis Christopher of SQM Research,

Fair play. I, for one, will be following his newsletters more closely in future.