Digital Finance Analytics (DFA) Blog
"Intelligent Insight"
The data from the ABS today shows that the Consumer Price Index (CPI) rose 0.5 per cent in the March quarter 2017. This follows a rise of 0.5 per cent in the December quarter 2016. The CPI rose 2.1 per cent through the year to March quarter 2017. The trimmed mean was 1.9 per cent. … Continue reading “Inflation rises 0.5 per cent in the March quarter 2017”
From wsws.org. Australian house prices have continued their unprecedented ascent, with median home values in Sydney this week hitting a record $1.15 million and in Melbourne, $826,000, after rising by 13.1 percent and 7.6 percent respectively in the first three months of the year. The frenzied growth of the east coast market has prompted a … Continue reading “More warnings about the Australian housing market”
From The Sydney Morning Herald. Deloitte Access Economics’ quarterly business outlook, released today, predicts the official cash rate of 1.5 per cent will climb slowly in 2018 and 2019 to reach 3 per cent in the early 2020s. The Reserve Bank was well aware “interest rates are now a massively more potent weapon for slowing … Continue reading “‘This thing’s gonna blow’: Top economists’ interest rate warning”
From The Conversation. In the first article reviewing The Conversation’s many articles on housing issues, the commentary about fiscal and supply-side issues was consistent. The same is not true for affordable housing due to the diversity of affordability issues. The issues have to do with the complexity and scale of the affordability problems and possible … Continue reading “Affordable housing, finger-pointing politics and possible policy solutions”
The Conversation has published many articles by Australia’s foremost academics on policies that affect housing. In the lead-up to expected announcements in the federal budget in May, we review the arguments in the articles since January 2016 – 81 were identified, of which 58 concerned housing policy. This article focuses on the most frequently mentioned … Continue reading “What housing issues should the budget tackle? This is what our experts say”
From WSWS.Org. The Reserve Bank resisted calls for an interest rate hike last week, amid growing fears that the continuing rise of house prices is creating the conditions for a crisis across the property market that would have far broader ramifications. On Tuesday, the bank’s governor, Philip Lowe, announced that rates would remain at a … Continue reading “Mounting concerns over Australian housing bubble”
From The AFR. Ask respected property analyst Martin North what form the coming downturn in the housing market might take and “orderly” is not the description he uses. Instead North anticipates a much more significant downturn in the investor-driven, debt-laden markets like Sydney and Melbourne. “Orderly” is how S&P Global Ratings director Sharad Jain described … Continue reading “Housing correction ‘won’t be orderly’”
Following the recent coverage of our mortgage stress analysis (light it seems is now dawning on regulators, industry commentators and others that household debt is a real and growing issue), one question we get asked is – yes, but surely the banks have guidelines on affordability and serviceability, minimum assumed rate 2%+ above current rates, … Continue reading “Why The Gap Between Bank Serviceability And Real Life?”
The Australian Financial Review covered the latest DFA mortgage stress research today, even if they managed to scramble the data in the chart I provided. Here is the correct data. This is what the AFR wrote: Household debt is rocketing towards 190 per cent of disposable incomes, ramping up pressure on the Reserve Bank of … Continue reading “Malcolm Turnbull backs RBA warning as household debt hits new record”
From The Conversation. Climbing house prices seem to scare people but houses are relatively more affordable today than they were in 1990, it’s actually interest-rate risk that’s the bigger problem for first home buyers. If you look at latest numbers on house prices, as a measure of affordability, they use a “median measure” – that … Continue reading “Houses aren’t more unaffordable for first home buyers, but they are riskier”