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Posts Tagged with Michael Matusik

Posted by admin on 30 July 2010

We attended a Macquarie Bank seminar this week where their Rod Cornish detailed historical stats and some forecasts on our property market. One tidbit that stood out was this gem: in the past 25 years Brisbane’s annual median house price went down just twice. In 1993 and in 2009. So in 23 of 25 years our median price went up.

There’s good reason residential property is considered “safe as houses”.

Ask a banker which security they’ll lend on. Residential property is king to them. We understand the merit of a balanced portfolio but do sometimes wonder if some investors have simply forgotten the strength of property?

For those of us too time-poor to track and research, property doesn’t rely on scientific analysis to determine the right time to buy or sell. Rismark’s Christopher Joye says price volatility of property is just 3 or 4% compared with 19% for shares. It’s no surprise you may be feeling giddy watching the All Ords of late.

Matusik Property Insight’s Michael Matusik says Australians on average hold 80% equity in their dwellings, and higher for their principal place of residence. There’s no great risk in that and shows the strength of our nation compared to others. Our love affair with bricks and mortar does continue, even if some of us have had a wandering eye in recent years.

Posted by admin on 5 May 2010

Don’t you love statistics?! Brisbane property researcher Michael Matusik has released some ABS data on Australia’s population growth in 2008-2009 and depending on your preferred interpretation the nation’s fastest growing city is Brisbane, Melbourne and Perth!

Brisbane City is the fastest growing municipality with a 21,161 jump in population for the year. (Now 1.05 million happy Brisbanites who all drive the same way as me at 5.30pm on a Friday!)

Melbourne (the big city not the little council area) grew by 93,478, making it the fastest growing capital city by numbers, with greater Brisbane 4th with 52,104 new residents.

Greater Perth can claim the title of fastest capital city by percentage, with a 3.2% jump!

So there it is – clearly Brisbane IS still the fastest growing city in Australia!

Posted by admin on 10 March 2010

We don’t often repeat material from other people on this blog, but the below notes from prominent Brisbane property commentator Michael Matusik are as topical as they come and deserve repeating as part of the ‘debate’.  The Government wants to debate the value of population growth to our city/state/nation, but unless we erect a big fence along Australia’s coastline how would we ever stop it?

Matusik Missive – Population debacle
10th March 2010

“I was involved in last week’s Great Growth Debate held by the PCA in Brisbane. This was held as a forerunner to the Queensland government’s own debate about the same subject, to be held at the end of this month. The PCA was hoping that the “pro” side of the debate would get a better airing if they ran their own shindig. The jury still remains out on that note.

In recent weeks, I have been asked on numerous occasions what I thought was the purpose of the government’s upcoming debate. My answers included – to distract and confuse the public; to been seen to be doing something; and to remove the sale of public assets off the media’s agenda for a while. I might have even said “bogan” public, which sounds harsh, but too many (and increasingly so) of our fellow citizens are not interested in any serious debate; readily swallow the spin and are more interested in what tattoo they are going to get next, rather than how the place is run. Get rid of compulsory voting if you ask me. But I digress.

As I said in my short presentation at the PCA gig the other day, it is a waste of time debating growth – it will continue to come. We need it, and even if we wanted to stop it (or even slow it down), we are largely helpless to do so. Even “planning for growth” is a waste of time – we have more plans that you can poke a stick at. What we should be debating is “how to accommodate growth”. We need implementation. Action is what is missing, and so too is political fortitude. Whilst I agree more with Mayor Pisasale’s ideals, I also admire Mayor Abbot, for at least he stands up for what he believes in and is prepared to be voted out come the next election if his constituents disagree.

What the market wants – and by, market, I mean residents, business, investors and the development community – is certainty. Strong leadership would have conducted this growth summit before the redrafting of the SEQ regional plan. The same would apply to the koala issue; ban the banning; potential changes to land tax and the sustainability declaration, to name just a few. Future planning matters should be dealt with in an organised way, such as the prescribed five year review of the regional plan.

But at almost every turn these days the Queensland government introduces a bill into Parliament, without adequately consulting the public. Sometimes, as in the sordid land tax case, previous decisions by the court are sought to be overturned. This uncertainty broadcasts loudly to potential investors in the state, to whom a stable legal system, with an observance of the rule of law, is a precondition to any investment. And many are not happy, Anna!

Back to accommodating population growth. I suggest the following measures:

Ø Decentralise the workforce out to major greenfield estates and beyond.

Ø Encourage more competition by forcing the major developers to release stock rather than drip feeding the market. They deny it, but that is exactly what they do.

Ø Get urbanisation to work by having minimum density targets, on a sliding distance scale, around our key pieces of infrastructure.

Ø Shorten, and make development approvals easier to get. ULDA gave themselves an approval in six months. That should be the benchmark now. Proof, as they say, is in the pudding.

Ø Limit local resident involvement to architectural, land use and sometimes tenancy matters only and not in the overall quantum of a new urban development.

In order to do such, a strong top-down approach to planning is needed. This takes political guts. Bottom-up planning, where NIMBY-ism rules the roost, is not working.

Population growth is coming. We cannot stop it and I suspect that it will accelerate (in Australia at least) over coming decades rather than slow down.

Unfortunately, “development” today is a dirty word in Queensland. What is even more despicable is that the government does not appear to see land as a significant asset. Nor do they understand – well, at least it is not portrayed as such to the voting public – that value adding to our land (i.e. development) creates wealth, jobs and a more sound economic future for Queensland.

In the lead up to the government population growth summit at the end of March, I hope that these thoughts or similar get an airing. In my mind, it is vital that they do.”

Share your views on “Michael’s Blog” at www.matusik.com.au

Posted by Rob Honeycombe on 8 April 2009

first home buyersSo the Reserve Bank dropped official rates yesterday and we now have a cash rate of 3%, the lowest since 1960. What’s next from the government for property? We all know confidence remains low but (while not wanting to talk things up) the worst may be over for real estate. In March the major property web portals had another big jump in traffic. Almost 5 million visitors went to realestate.com.au, up 11% on the same time last year.

Some markets (but not all) are witnessing more sales. In making the rate cut announcement the Reserve Bank’s Governor confirmed there’s been more activity. “Demand for credit is weak overall, though credit for owner‑occupied housing is picking up”, he said. The chatter about the market right now is getting more positive. The big surge of course has been from first home buyers, keen to take up the $7000 boost to the usual grants. In the last quarter of 2008 the govt handed out 7,659 FHOG giftbags, up a whopping 39% on the previous 3 months. And we can’t help wondering if Swan and Rudd will feel that when the boost offer expires on June 30th it’ll be time to shift their support to another market.

Reserve Bank deputy Ric Battellino might agree. He last week told a Brisbane seminar the grant’s benefits could quickly be eroded. “By all accounts the bottom end of the housing market has picked up a lot in recent times and it doesn’t take long for the average house price to increase by $20,000 and leave the homebuyers no better off than they were before.” Market analyst Michael Matusik is opposed to the grant. “The FHOG is inflationary, distorts the normal cycle and creates few new homes over the longer term.” He argues in a time of undersupply we should have incentives to build new housing.

Some commentators worry that removing the first home boost will punish the lower end of the market. But our view is there’s a whole bunch of forgotten buyers on the sidelines getting closer to acting. Investors might just be the next busy audience as they recognise the opportunities on offer.

How should the government support the housing market? We’d love to hear your comments…

Posted by admin on 4 December 2008

 For those of you who love their property stats, here’s a round-up of some of the latest on our market. According to RP Data Brisbane prices are down 1.7% for 2008 with our auction clearance rate just 25%. The average time it takes to sell a house is now up to 47 days and apartments are 44, with an average discount from original listed price of 6.1%. Rents have risen strongly this year – up 10% for 2 bed apartments and 14% for 3 bed houses in the inner suburbs, according to the Residential Tenancies Authority. The Real Estate Institute of Qld says the vacancy rate is 1.3% (down from 2.6% in June 2007), while in our office it’s currently 0.5%.

The ABS has just released population data for the year to June and Queensland added 98,000 residents. QIC’s Doug McTaggart says this will grow as Sydney house prices recover and New South Welshpersons creep over the border. Valuers Herron Todd White report the inner city’s market is holding up relatively well and “staying near the CBD will certainly help keep property blues at bay.” The Reserve Bank yesterday dropped official interest rates by another full point to 4.25%, some commentators are tipping it’ll go to the 2’s, and analyst Michael Matusik comments that “every 0.25% fall translates into a household being able to push up the price of housing by 2% for the same level of repayments”.

Posted by admin on 29 May 2008
We didn’t spot any Councillors in the audience but around the same time of Bees Nees seminar last week and our ‘sneak-peek’ at property in the year 2020, BCC has moved to allow greater building heights in the South Brisbane/West End area. The Lord Mayor’s been quoted supporting up to 30 storey in selected near-city areas and up to 12 storey along the river.

Contemplating the population targets set by the State Government, the Brisbane City Council is looking to areas surrounding the CBD, and taller towers to accommodate more people. The announcement’s generated the odd headline or two but it seems the broader public may be accepting Brisbane’s evolution in this direction.

More than 240 locals attended our 2020 seminar, with local resident and planner Andrew Crawford mapping out this pocket’s transition, and market commentator Michael Matusik offering his insight. Michael reminded us that looking back 12 years our median house sale was just $132,750, and with that now past $600,000 it isn’t hard to imagine his predicted $1.5million price tag in the year 2020.

Notes from the seminar are available at the Research page of our website, along with a link to Michael’s full presentation. We hope you find it interesting.

 

Posted by Rob Honeycombe on 8 May 2008

apartmentsWith the Treasurer warming up for his Queensland state budget on June 3rd it’s timely to ‘blue-sky’ how our pollies could actually be helping with housing affordability. What’s well-reported is the vast undersupply of housing, with market analyst Michael Matusik putting Queensland’s annual shortfall at 44,900 homes. Interesting to note is the revenue our state generates from property – with more than $3.7billion (yes billion) flowing from stamp duties on sales, land taxes and duties on mortgages.

Despite plenty of talk in 2000 that the GST could eventually replace state taxes, some 28% of our state’s revenue still comes from taxes and duties, with an unhealthy dependency on the property industry.

Would reducing some of these help our housing affordability crisis? While the government is scrapping mortgage duty (now down to 0.2% and nil from January 1st 2009) it’s stamp duty where the state really hauls in the bucks, up 16% this year to $2.8billion. While you pay no duty to buy listed shares, a property investment of $450,000 will land you a stamp duty bill of $14,225. It may be cheaper than other states but it’s still a huge disincentive to investors, and that impacts on tenants through higher rents. Should an investor pay more stamp duty than an owner occupier? ($600 more in the above example). There’s a third of our population that rent so surely we need incentives to create new housing for them.

Victoria this week moved to further reduce their stamp duty rates, and they remain the only state to offer a genuine incentive to build new property. In the Garden State buying off the plan means hefty savings in duty compared with established property – the amount is calculated only on what exists at the date of contract, usually just the land. It’s a simple idea, offers an immediate encouragement to bring new housing supply online and Queensland could do the same thing on June 3rd. Construction costs are still rocketing ahead with home builders and developers struggling to make new housing viable, and we’ll all grow old waiting for that to change.

With stamp duty revenue soaring up along with housing prices our government’s had a huge, largely unexpected windfall over the past three years. Solid moves to encourage new housing supply must surely be on their agenda.

Posted by Rob Honeycombe on 8 May 2008
If it’s good enough for Kevin Rudd and Cate Blanchett! Bees Nees are hosting our own “Vision of 2020″. Focussing on West End, South Brisbane and Highgate Hill the May 19th 2008 seminar will take a look at the local property market in 2020. New apartments are replacing industrial uses at a growing rate and BRW Magazine recently tagged the area “the star performer of Australia’s urban renewal precincts”. So how will the area’s housing change over the next 12 years?

We’ve asked two well-respected property experts to share their views. Independent market analyst Michael Matusik knows the market inside out and he’s not afraid to share an opinion or two. Michael has a solid understanding of what buyers and tenants of the future will want. West End resident Andrew Crawford has another perspective as a townplanner and former manager of our Urban Renewal Taskforce. He’s been at the driving wheel of major land-use changes in the Newstead/Teneriffe area and knows the process well.

The seminar is on Monday May 19th 2008 from 6.30 to 8pm at the Convention Centre in South Bank. If you’d like us to send you a free double pass just click to email and quote “FREE-BEE 03″. We’d love to have you along as our guests.
Posted by Rob Honeycombe on 26 September 2007

boom marketThey’re just not great headlines: “Market good, some prices up strongly, other prices up a bit”. And of course it serves some peoples’ interests to talk a market up, especially if they have a bunch of new properties to sell. So amongst the repeated stories of a return to boom days, here’s a quick look at the stats and some thoughts from on the ground in Brisbane’s inner suburbs.

According to Macquarie Real Estate Brisbane’s house prices rose 9% in the first half of this year. Matusik Property Insights report a jump of 6% in the June quarter alone (yes that’s 24% annualised). These are very strong numbers from very credible sources. And with just under 50,000 people moving to Queensland in 2006 (net of those deserting us!) demand for housing is strong. Matusik rightly reports that supply is still constrained, and shortfalls in Brisbane are “acute”.

Inner city Brisbane is clearly a mixed bag with houses and many apartments suited to owner-occupants selling fast and with prices that reflect the reported stats. It’s fair to say we are going through a mini-boom in some pockets. Investors though have not yet leapt back into the market in big numbers. While rents are rising they’re not on fire, so net returns are yet to stir serious levels of interest. And investors are a little preoccupied elsewhere. ABS report a $72billion increase in Australians’ superannuation assets during the June quarter as people rushed to meet the June 30 deadline. That money’s simply not flowing back to property – yet.

So for a lot of smaller or older inner Brisbane apartments there’s now some big price savings compared to larger apartments and houses right next door, simply because there’s fewer buyers for them. The part-time developers are starting to pounce on unwanted, tired apartments and doing a Blitz/Block/Hot Property makeover, serving them back to a hungry owner-resident market. For those keen buyers who enjoy painting bathroom ceilings on their Sunday mornings there’ll no doubt be some dollars to be made!

Posted by Rob Honeycombe on 2 May 2007

apartment livingMany apartment investors set a 2 bedroom minimum for their home hunt and in doing so bypass a large part of the inner city’s market. With our household size still shrinking due to divorce and lower fertility and death rates, we need to keep an eye on what demand there is for each type of home. Prominent researcher Michael Matusik this week claimed that people living alone would soon (probably within 15 years) represent Australia’s largest household type. In New Farm, Bowen Hills and the Valley lone person households already occupy more than 40% of dwellings.

So which is the better investment apartment – 1 bedroom or 2? There’s no question 1 bedrooms are cheaper for tenants. In the 1st quarter of this year median rent for a 2 bedroom in the inner city was $350, while a 1 bedder was just $250. Unless tenants intend to share or somehow make permanent use of the 2nd bedroom it’s an expensive accessory. Any good property manager will tell you right now the smaller (read “cheaper”) apartments are definitely quicker off the mark, but much of the supply available is still skewed to 2 bedrooms. In the 1st three months of 2007 there were 2480 new bonds for rented 2 bedders and 1,704 for 1 bedrooms.

What about yield/returns and capital gain? If we could find reliable stats to measure this we’d be pretty smart cookies! As an example only, our two most recent sales were in the same Spring Hill building – a 2 bedroom sold with a gross return of 5.7% and a 1 bed with 5.5%. So we did the maths on capital gains in that same building. There’s been 12 re-sales of 1 bedroom apartments since completion in late 2005, at an average 23% gain. The 10 re-sales of 2 bedders have reaped their owners an average 16% increase in value. These apartments all had very similar outlooks and the same level of finish and amenity.

Like any marketplace there’ll be trends and shifts, but affordability and shrinking households suggest that while 2 bedrooms will continue to appeal to a broad market, 1 bedroom apartments might be a worthwhile investment for the inner city. And with the money you save you can always buy two properties (we are real estate agents after all!)