Unconventional Economist

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Auction market bullish for Sydney property?

CoreLogic has released its final auction clearance results for last weekend, which reveals that the final national clearance rate retraced to 69.1% from 70.6% the prior week: Sydney’s auction clearance firmed to 71.6% from 71.3% the prior week, whereas Melbourne’s rose to 70.0% from 69.7%. As noted by CoreLogic: Last week, the combined capital city

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Melbourne’s CBD is a ghost town

Data from the City of Melbourne shows that 28% of businesses in the CBD are vacant or remain closed, despite the fact that COVID-19 restrictions have been eased. An average of 911,000 people travelled into the CBD on every work day prior to the pandemic. Weekday pedestrian numbers have returned to about 50% of pre-coronavirus

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In property there’s Sydney and Melbourne and then everything else

Earlier this month, the Australian Bureau of Statistics (ABS) released its 2019-20 Australian System of National Accounts (ASNA), which provided a detailed presentation of annual national accounts data. Locked away on Table 61, the ASNA confirmed that, at a national level, the land values underpinning the Australian house prices rose strongly when measured against GDP.

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As Victoria’s population boomed, residents went bust

In this week’s State Budget speech, Treasurer Tim Pallas suggested Victoria was the nation’s economic powerhouse lead-up to the COVID-19 pandemic: Speaker, under this Government, Victoria began 2020 as a national leader in jobs growth. Half a million more Victorians had found work since we were elected in November 2014. Our economy had grown by

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CoreLogic weekly house price update: Boom!

In the week ended 26 November 2020, the CoreLogic 5-city daily dwelling price index, which covers the five major capital city markets, rose another 0.27%: It was the sixth consecutive weekly rise. All major markets recorded value rises: So far in November, dwelling values have risen by 0.59%, with all major capitals rising: Quarterly value

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Links 27 November 2020

Global Macro / Markets / Investing: Wall Street rocks as food lines grow. – WSJ World Economy Teeters Near New Slump, Defying Vaccine Optimism – Bloomberg Uber Hits $90B Market Cap – The Techee Japan stocks set to trade higher after Dow surges to a new record – CNBC Americas: Trump administration strips Biden’s options

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Aussies dump retail super funds

The Australian Prudential Regulatory Authority (APRA) has released its Quarterly superannuation performance statistics highlights for the September quarter. This report shows that total superannuation assets fell by 1.6% in the year to September: Superannuation assets totalled $2.9 trillion at the end of the September 2020 quarter. There was a 1.6 per cent reduction in the value

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Investor mortgage stress to rise as income support unwound

Economic modelling shows that the federal government’s coronavirus support measures have been crucial in averting widespread housing affordability stress (HAS). The modelling, which was undertaken on behalf of the Australian Housing & Urban Research Institute (AHURI), suggests that some 1.336 million households would have experienced housing stress without government initiatives such as JobKeeper, JobSeeker and

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Victorian Government reboots hotel quarantine system

After the fatal flaws of its first hotel quarantine scheme, which relied solely on untrained private security, the Victorian government will launch its revised quarantine scheme on 7 December. Victorian Health Minister Martin Foley has promised the system will be robust: “All Victorians can have confidence that the system that will be put in place

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Actual capex plunged further in Q3

The Australian Bureau of Statistics (ABS) today released data on capital expenditures (capex) for the September quarter, which registered a 3.0% seasonally adjusted fall in capex volumes over the quarter and an 13.8% decrease over the year (see below table). The first chart below shows actual capex by industry in dollar terms (rather than volume

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Suburban Rail Loop “worst transport project Melbourne has ever seen”

Like me, Inside Story’s Tim Colebatch is an overall fan of the Andrews Government’s Victorian State Budget, which provides massive stimulus at exactly the right time: The main game of the Andrews government’s 2020–21 budget is to deliver stimulus, and it does so in spades. It plans to spend almost $110 billion this year providing

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More support for using superannuation to buy property

I noted yesterday how calls were growing louder to allow first home buyers (FHBs) to use their superannuation savings to purchase property. This has arisen following the release last week of Treasury’s Retirement Income Review, which found that home owners enjoy superior retirement outcomes than non-home owners. The proposal has moved one step closer to

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Retirement review takes aim at pensioner houses

The Treasury’s 600-page Retirement Income Review took direct aim at pensioners’ houses, questioning why housing was excluded from the assets test to qualify for the aged pension: The Pension Loans Scheme is an effective option for accessing equity in the home for both age pensioners and self-funded retirees. The current exemption of the principal residence

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Defensive Paul Keating lies again on super

Following the Retirement Income Review’s scathing assessment of Australia’s compulsory superannuation system, the architect of the system, Paul Keating, too to ABC’s 7.30 Report to rubbish the Review’s findings with a bunch of lies and obfuscation: LEIGH SALES: Let me ask you address the point that we heard the Reserve Bank Governor make and it

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Universities’ international student addiction beggars belief

The federal government yesterday released the 2019 Financial Report for Higher Education Providers, which revealed that Australia’s universities earned over $10 billion in fees from international students in 2019 – a record 27% of their revenue: The report also debunks the claim that the federal government has continually cut funding to universities: That is, despite

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Links 26 November 2020

Global Macro / Markets / Investing: Elon Musk has added $100.3 Billion to his Net Worth and Overtaken Bill Gates to Become World’s Second-Richest Person – Tech Elevation While the Stock Market Is Facing a Bubble, Warren Buffett Opts for the Best Possible Value in His Eyes – Medium New Era Requires New Approach to

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COVID-19 restrictions drive fall in winter mortality rate

According to the ABS’ Provisional Mortality Statistics, winter deaths fell below average due to COVID-19 social distancing restrictions: 92,015 doctor certified deaths occurred before 25 August. Deaths rose in the second half of winter but remain below average. Respiratory disease deaths have been lower than historical minimums since June… There were 7,941 deaths from respiratory diseases between 1

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South Australia overhauls hotel quarantine system

The South Australian Government has announced an overhaul of its hotel quarantine system after systemic failures led to an outbreak numbering 29 cases: South Australia has announced urgent plans to overhaul its medi-hotel system, amid a coronavirus cluster that emerged from Peppers Waymouth Hotel in Adelaide. Those changes include moving all people who test positive

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Nick Gruen slams superannuation union ‘gravy train’

Professor Nicholas Gruen from Lateral Economics has called for Australia’s superannuation system to be overhauled, labelling it a union “gravy train”: “Unfortunately unions have turned the system into a gravy train for the retirement of their own officials onto boards,” Professor Gruen said. “But if they could see the larger game, they’d end up with

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China must not be allowed to dominate regional trade deals

Last week the Morrison Government signed the giant secret trade deal called the Regional Comprehensive Economic Partnership (RCEP). The RCEP is led by China and will also comprise members of the Association of Southeast Asian Nations plus Japan, South Korea, New Zealand and Australia. Now China has indicated that it is interested in joining the

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Savers slaughtered as deposit rates crater

Data from RateCity shows that banks have slashed deposit rates since the RBA’s latest interest rate cut, with the average ongoing savings rate across the banking system now just 0.46%: According to RateCity, 30 banks have taken a knife to interest rates since the RBA cut, with the average ongoing savings rate across the banking

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Residential construction collapses

The ABS has released data on the value of construction work done for the September quarter of 2020, which registered another 2.6% seasonally-adjusted decline in total construction activity over the quarter – the ninth consecutive quarterly decline – and a 4.2% decrease over the year: However, the result disappointed analysts’ expectations of a 2.0% decline

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Chief international student lobbyist demands open borders

CEO of International Education Association of Australia, Phil Honeywood, has demanded states lift their caps on international arrivals so that Australia can welcome thousands of international students: NSW has been accepting 80% of all returning Aussie citizens. Time for other states to do some heavy lifting so International students can return! #Intled https://t.co/quhD4PcCmi — Phil