Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 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's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete 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 & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Friday, 16 September 2016

Mining bust sees regional land prices deflating

Land boomers

Capital city vacant land prices rose by +8.1 per cent over financial year 2016, according to CoreLogic.

In Sydney the median land price rose by +12.5 per cent or nearly $47,000 to $422,500..

And Sydney prices were up by a thumping +15.8 per cent on a per square metre basis.

Meanwhile in Melbourne the median land price rose by +13.9 per cent to $255,000 (although only +6.5 per cent on a square metre basis).

Overall it's evident that capital city land prices are flying. 

Even in Perth the land price rose by +7.4 per cent to a thumping $284,500, while in Hobart the median land prices soared by +20.3 per cent to $160,000.

Only in Adelaide did capital city land prices decline marginally in real terms.

Mining bust

In November 2012 I wrote on the Property Observer website how investors should stick to the capital cities.

It wasn't entirely clear back then, of course, but as it turned out that quarter proved to be the peak of the mining investment boom, with construction activity declining ever since.

Since the construction phase is the labour-intensive phase of the mining boom, it's been a tough four years for many regional centres (and disastrous for many mining town property markets).

Domain reported today about how parts of Rockhampton have been struggling since 2007, but at least Rocky isn't a one trick pony.

Prices in Gladstone have crashed by 50 to 80 per cent!

In truth it's taken longer than I expected, but as the greatest mining investment boom in 150 years turns to bust median land prices in regional areas are deflating, declining by -1.9 per cent over the past year. 

When looked at on a vacant land rate per square metre basis the divergence between capital cities and combined regional Australia is stark.

In fact, as capital city lot sizes shrink the differential of 231 per cent when measured on a per square metre basis is the greatest ever recorded as the capitals continue to outperform the regions.