How MB irradiated Flufferfax

Flufferfax has gone quiet. Until a few weeks ago it was flooding Australia with realty propaganda. Multiple times per day, Domain Fluffers hogged metropolitan and business headlines with stories that cherry-picked data, selectively quoted property parasites and were generally characterised by a bullish tone quite at home in a drug-saturated Wall Street saga.

MB held this flow of property spittle to account with data, analysis and objective humiliation. I have no idea if those coughing up the goo felt the professional disgrace that they should but it sure can’t have made them feel good. Perhaps in some small way we did dam the flow with an enthusiastic blog-flaming that reminded the once great publishing house that it still has some ethical obligation to its host society.

Probably not. My guess is that what did kill the Flufferfax flood was this post:

Here are the tumbling volumes:

Why have they fallen and will they rebound? CoreLogic explains it:

“Interestingly, real estate agent activity across CoreLogic platforms, as measured by the CoreLogic listings index, has been tracking higher than a year ago, despite the lower amount of fresh stock being added to the market. Increased levels of agent activity translating into fewer new listings indicates a heighted level of competition amongst real estate agents for listings. Sellers may also be nervous about selling in a strong market, especially with the consequential challenges of buying well in that same market.” …

“Despite the low mortgage rate environment, high transaction costs may also be a disincentive for transacting in the housing market. Due to bracket creep and higher dwelling values, we’ve also seen stamp duty dollar value payments rise substantially. In addition, percentage-based expenses such as agency commission fees for vendors have moved higher as the value of housing rises. It is likely that an increasing number of home owners are weighing up the pros and cons of the costs associated with selling and buying, or, staying where they are. It seems an increasing number, particularly in Sydney, are choosing the latter.”

Contrast this with the ceaseless Flufferfax line that lower listings are driving demand and prices wild. This giant spruik has been pushed relentlessly across the group and we now see the self-destructive fruits of such an editorial policy. If there is a pervasive fear over affordability, and folks are scared they won’t be able to buy back in if they sell, then that is what is preventing people from transacting their properties. Accordingly, Flufferfax is busy killing both the property market and its own volumes-driven Domain listings business.

Over the weekend we got a glimpse of where Flufferfax will probably shift to next, from sullied McGrath at The Australian:

Sydney and Melbourne’s heated housing markets will pause next year, with price growth stalling but no crash in sight, according to veteran real estate agent John ­McGrath.

The drought in listings will break early next year, with owners already sounding out agents ahead of offering their homes in February, Mr McGrath said.

“There will be less or no growth, but not a major correction,” he said of the Sydney and Melbourne housing markets where prices have risen 64 per cent and 44 per cent respectively since 2012 and auction clearance rates have topped 80 per cent.

“It would be dangerous to have another year of double-digit growth. That would not be sustainable.”

Mr McGrath also expects both cities’ markets to “decouple” further from the rest of the country’s markets, mirroring cities such as London and New York where the weight of demand has created separate markets with unbreachable price gaps.

The Big Spruik needs transaction volumes to rebound so it also needs prices to stop rising or the narrowing of the market will get worse. They can’t have falling prices either, which are also bad for volumes. So, we’re going to see the push for the ‘great leveling out’ of prices. If they can’t pull it off then recent share price performances are going to get worse:

These shifts in Flufferfax editorial are clear evidence of the Propertocracy at large. Australia has never before been in the grip of such a potently corrupt social and economic engineering engine. The MSM has for a long time pimped its editorial to piggy-back advertisers. The Murdoch Press has always sought to press his agendas to business advantage. But the phenomenon of one half of the media duopoly mobilising its full breadth and power to inflate a single asset class to sustain its only remaining profit centre is a new development of macroeconomic significance.

Therefore we cannot say that the economic malignancy of Flufferfax has been cured, even if the cleansing radiation of MB has driven it into remission.