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NEWS: Shortage gets worse due to lack of interest in additional homes

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New home sales fall for second month

CHRIS ZAPPONE

August 2, 2010 - 11:39AM

New home sales fell for a second straight month in June to a 17-month low, as rising interest rates continued to erode demand.

The Housing Industry Association's home sales index dropped 5.1 per cent in June, following a 6.4 per cent drop in May, as the lingering effects of pricier loans acted as a deterrent to new buyers entering the market.

Victoria fared the worst, with house sales sliding 10 per cent, while New South Wales posted a 2.2 per cent fall. Sales of houses dropped 5.2 per cent in Western Australia and 5.1 per cent in Queensland, HIA said. In South Australia new home sales went backwards by 4.2 per cent.

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HIA chief economist Harley Dale said the drop in sales highlighted the problems facing the housing construction sector.

''Australia's dwelling shortage will continue to increase, pushing up existing house prices and disadvantaging households seeking to purchase or rent a dwelling,'' Mr Dale said.

More here: http://www.theage.com.au/business/property/new-home-sales-fall-for-second-month-20100802-112a4.html
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Just because people are not trading dwellings as fast doesn't mean there's a shortage. Just means the turnover is lower.

If house prices don't double every 5 minutes, people are going to be less inclined to do a cheaparse Home Makover on their house (or an 'investment property' that they intend to flip) and sell it 6 months later at a profit and then do it again. They'll actually shop around a bit more, and buy something they can afford and want to be in for a bit longer.

I could be optimistic, of course ...

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Just because people are not trading dwellings as fast doesn't mean there's a shortage. Just means the turnover is lower.

but they are talking abt. new house sales, right? so not just trading houses. though i didn't read the article in depth, i must admit.

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''Australia's dwelling shortage will continue to increase, pushing up existing house prices and disadvantaging households seeking to purchase or rent a dwelling,'' Mr Dale said.

How is this going to alleviate the shortage?

ladenute.jpg

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Saw a block of units/condos today (20 from a rough count) where every single one was for sale and the shops and outlets underneath were for sale or lease. Outstanding.

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That article makes my head hurt - a lack of demand, falling turnover, falling number of loans, falling auction clearances and more houses for sale etc etc, is somehow proof of a shortage getting worse :shocking::frusty:

Can you imagine Ford & Holden coming out and saying that the declining sales of large cars (Falcon/Commodore) is evidence of a looming shortage.....

They of course blame it on 'pricier loans' 'acting as a deterrent', it could never possibly be pricier houses...

Oh, nice pic claw :D

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+1

NT plates too. God I hate those vehicles. Moron-mobiles. Impractical rubbish marketed for bogans.

They are actually QLD plates but i agree, if holden made the VR-VS platform available in a flat tray instead of styleside, they would have been on a winner. I have always had a pet hate for 'style side' utes since I borrowed one to move house one time.

back OT, this 'shortage' cultivation is getting silly now. I can't picture any other industry where a potential shortage is indicated by falling demand.

Edited by bunge

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They are actually QLD plates

Sorry. I was pissed and thought the letters were ahead of the numbers.

On the Shortage thing, Kris Sayce is on fire today.

But when a housing shortage and a rising population is all you’ve got to go on to convince house buying suckers that property prices always go up, well, you’re not going to let go of it without a fight.

All I’ll say is, hats off to the spruikers for sticking to their guns.

But at least fewer people are listening to their drivel and seem to realise that the great Australian house price boom has run its course.

Looks like it could be all downhill from here…

Cheers.

Kris Sayce

for The Daily Reckoning Australia

The full report: http://www.moneymorning.com.au/20100803/spruikers-new-excuse-is-the-same-as-the-old-one.html

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but they are talking abt. new house sales, right? so not just trading houses. though i didn't read the article in depth, i must admit.

New, secondhand, same thing - people will stay put if they can't afford to move elsewhere so the 'demand' drops. And new is often cheaper so that's even worse!

I demand a new house but I can't afford it at current prices so I'm saaaaaving up :)

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I'd like a Jaguar XK but I'm damned if I'll pay the stupid price tag.

"There is a shortage of Jaguars says an economist with the British sports car manufacturing association..."

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I'd like a Jaguar XK but I'm damned if I'll pay the stupid price tag.

"There is a shortage of Jaguars says an economist with the British sports car manufacturing association..."

No sh*t, it's a pretty weak, transparent argument.

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