Digital Finance Analytics (DFA) Blog
"Intelligent Insight"
My latest outing with our Property Insider Edwin Almeida. We look at the latest from our We-chat chatters, the numbers, which go on rising, and the housing policies from the main parties.
https://www.ribbonproperty.com.au/
Go to the Walk The World Universe at https://walktheworld.com.au/
New Zealand Housing makes an interesting case study, given the Central Bank there started lifting rates last year, following a strong period of credit driven price growth.
Now the IMF has reported on the state of play, and they highlight the risks in the system. https://www.imf.org/en/Countries/NZL
In its latest review of the New Zealand economy, the IMF has had a close and detailed look at the housing market. The housing market they say constitutes a risk in view of borrowers’ vulnerability to rising mortgage rates, high household debt, and banks’ exposure to housing.
The IMF says that financial stability risks from a sharp downturn in the housing market are limited given high bank capitalisation, “but pockets of vulnerability, particularly amongst recent borrowers, may exist”.
“More broadly, there is likely to be a larger impact on consumption through wealth and sentiment effects. In a scenario of a marked housing correction, macroeconomic policy support may be needed to avoid second round effects and a pronounced downturn.”
Go to the Walk The World Universe at https://walktheworld.com.au/
The latest report on Housing Affordability from ANZ and Corelogic underscores the pressures on Households, and mirrors findings from our own Stress Surveys.
On every metric, affordability has crashed, but then what do you expect from 20+ years of bad policy, ultra low rates and Government incentives? And, no, the answer to all this is not just of offer more incentives to drag people into the market at these high multiples!
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We look at recent commentary from New Zealand highlighting three forces which are combining to drive home prices lower. In fact, we argue they are three for the four horses of the apocalypse. As a result, expect prices for fall further and faster. And this is an objective lesson to Australia, who is about 6 months behind.
Go to the Walk The World Universe at https://walktheworld.com.au/
An excellent BNZ report really underlines the pressures on the New Zealand economy. A recession could well be on the cards. Take note, as NZ is months ahead of Australia and other countries in trying to unwind overgenerous QE and too low interest rates. Question is, will the medicine kill the patient?
Go to the Walk The World Universe at https://walktheworld.com.au/
REINZ Released their data for APRIL, and as expected property prices and momentum are moderating, with a further slowdown in sales activity, more moderate price growth and, as properties stay on the market for longer.
Across New Zealand, the number of residential property sales decreased annually by 35.2% in April 2022, from 7,497 in April 2021 to 4,860. The sales count for New Zealand excluding Auckland, decreased 31.7% annually from 4,815 to 3,287.
Go to the Walk The World Universe at https://walktheworld.com.au/
I discuss the announced housing policies from the two major parties with Steve Mickenbecker from Canstar. Are they worth the paper they are written on?
Steve Mickenbecker is in Canstar’s Group Executive Team, bringing more than 30 years of experience in the Australian financial services industry. As a financial commentator for Canstar, Steve enjoys sharing his expertise across topics such as home loans, superannuation, insurance, mortgages, banking, credit cards, investment, budgeting, money management and more.
https://www.canstar.com.au/team-members/steve-mickenbecker/
Go to the Walk The World Universe at https://walktheworld.com.au/
The fact is the RBA has been off the pace in terms of forecasts, and strategy, and as a result they are not lifting rates into a slowing economy to try to tackle inflation which they partly created.
In addition, the latest Statement on Monetary Policy shows real wages are set to decline over the next couple of years, while overall growth will decline, despite a (artificially) low unemployment rate.
Time for a proper review of the RBA – how do we make the Governor and his team more accountable. Being embarrassed is not enough!
Go to the Walk The World Universe at https://walktheworld.com.au/
An edited version of my live discussion with Edwin, our property insider, ahead of the the RBA cash rate decision tomorrow.
Go to the Walk The World Universe at https://walktheworld.com.au/
I caught up with Peter Marshall from comparison site Mozo.
He has been working in the Australian banking and finance industry for over 20 years and oversees Mozo’s extensive product database. He is regularly sought out for his expert commentary and analysis on banking and interest rates trends by print, radio and TV media.
Today we discuss the prospect of higher mortgage rates ahead and what people can do to prepare.
https://mozo.com.au/authors/peter-marshall
Go to the Walk The World Universe at https://walktheworld.com.au/