Ding ding

Hells bells

There's an old Wall Street proverb that says nobody rings a bell at the top or the bottom of the market.

That's true, but the marginal buyer in the housing market would have to be considering having a dabble now.

What a difference a week makes, with a trifecta of positive news for property markets, kicking off with the Federal election result. 

After three years of polling predicting an outright Labor victory the silent voters took a sceptical look at Labor's hotchpotch of new taxes and binned them outright. 

There's little value-add in Monday morning (Wednesday morning) quarterbacking on the election results, but the retirees I saw at a recent investor conference were absolutely seething with rage on the franking issue, which presumably would have accounted for some of the Queensland voting. 

They quite probably weren't ALP voters anyway, but the vibe was not good. 

And as well as retirees between them Bowen, Shorten & Co. did quite a job of rattling the cage of mortgage brokers, real estate agents, developers, and miners, not to mention those living in mining regions, and others. 

While Labor campaigned on a range of disruptive taxes for the housing market, by contrast Morrison is effectively a 'pro-property' PM, and indeed he's already promised a first homebuyer deposit scheme to kick in from 1 January. 

Secondly, after today's speech markets are now pricing a June rate cut as a near certainty (with a 92 per cent implied likelihood), and given that the RBA is not into fine-tuning outcomes right now another is likely to follow before long. 

A third and fourth cut shouldn't be discounted given that unemployment could fall much lower than 5 per cent without bringing about inflation. 

And thirdly, the easing bias was apparently well coordinated with APRA's plan to recalibrate assessment rates, which was a welcome move. 

It wouldn't be surprising if the responsible lending piece gets a bit of a nudge as well, as scrutiny of borrower expenses has swung from one extreme (often non-existent) to the other (insanely pedantic). 

If you haven't acted yet unfortunately you've already missed the bank bounce, with Commonwealth Bank surging from lows of around $65 up to $80, and Westpac having a heck of a run this week. 

But the property market bounce shouldn't be too far behind.

To be clear we're still at the tail end of a construction boom with settlement failures commonplace, and there's a significant amount of idle stock languishing on the market, so these markets still need to clear. 

And caveat emptor applies: marginal moves in a price index are one thing, but you don't buy an index, you buy a property.

I'll do a quick post on mortgage arrears which will add some colour.