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News: Housing industry's missing persons reports pure fiction

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I've criticised Mr Ryder before, but this article is bang on!@

Housing industry's missing persons reports pure fiction

HOTSPOTTING: Terry Ryder From: The Australian September 02, 2010 12:00AM

MISSING: Authorities are seeking the public's help in locating 190,000 families who have mysteriously disappeared from Australia.

REWARD: $60 billion, for any developer or builder who can find them.

These are the 190,000 households that, according to the construction industry, are desperately seeking new homes but can't get them.

I've been looking for them, but can't find them.

I know many builders have been having the same problem.

I'm beginning to think they don't exist.

The Housing Industry Association keeps telling us we have a chronic housing shortage, with a shortfall of 190,000 homes.

Personally, I think this is fiction -- something the HIA is so good at it's in line for a Pulitzer Prize.

Its finest work of fiction is the Affordability Index, which claims the average first-home buyer in Australia pays $535,000 for the typical first home.

If you're looking for a copy of this publication, you're likely to find it in libraries in the "fantasy" section, because the ABS tells us that the average first-home buyer in Australia borrows $292,000.

The report that claims unsatisfied demand for 190,000 new homes should be found in the "science fiction" section, alongside books that depict time travel and interaction with aliens from worlds a thousand light years from earth.

The HIA has written a publication that looks deep into the future, foreseeing a 466,000 shortfall in 2020. George Orwell's 1984 was a nursery rhyme compared to this.

The odd thing about this persistent complaint that we're not building enough houses is that the loudest whingers are the people whose job it is to build houses.

There are large tracts of zoned residential land in our cities (owned by major developers) waiting for houses to be built on them.

If we've got a 190,000 shortfall, why aren't they frantically building?

If the HIA figures were true, we'd have tens of thousands of families living in tents or under bridges.

Full Article: http://www.theaustralian.com.au/business/property/housing-industrys-missing-persons-reports-pure-fiction/story-e6frg9gx-1225912980273

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I've criticised Mr Ryder before, but this article is bang on!@

Full Article: http://www.theaustra...x-1225912980273

and from the courier mail a few weeks ago

I KEEP on reading about how undersupplied the market is, yet all the evidence at the coalface suggests otherwise. Even when the new stock for sale is affordable or, better still, offers value for money, buyer interest is weak. How could this be?

Aren't we so undersupplied with new housing that it is bordering on a national crisis?

A step back from the hype, industry hyperbole and vested interest groups suggests otherwise. The residential market might even be heading into oversupply.

Yes, oversupply. And as Australia's population ages, more spare capacity will be released on to the market. New supply could even be seriously overdone if overseas migration figures fall to the extent that some are now predicting.

From mid-2005, stronger net overseas migration created a divergence between total population growth and new housing starts. If you were to chart the two by separate lines, population growth leapt way ahead of new dwelling construction.

Start of sidebar. Skip to end of sidebar.

End of sidebar. Return to start of sidebar.

But much of the net overseas migration - up to 60 per cent in some states - doesn't add that much to new housing demand. Many new arrivals are either tertiary students, business people on temporary work visas, or those who fit in to the family reunion category.

As a result of more overseas migrants in the population mix, the average household size is increasing across Australia - and especially in Queensland, where the recent increase in overseas numbers has had a greater impact. New migrants live with, on average, one more person per household than older Australian households. The recent increase in household size reflects current demographic trends rather than housing stress.

Packed to the Rafters is a more apt description of the Australian housing market than Home Alone.

When modelling increasing household size against population growth, new housing demand is not as strong as most think, especially when you factor in the real impact of new overseas migration.

In addition, we have been over-consuming in housing for some time. According to the 2006 Census, one in 10 residential dwellings across Australia is unoccupied (830,000 in total) and the latest advertised dwellings for rent from RPData suggest that the national vacancy rate is well over 4 per cent, and even higher across Queensland.

There are also a lot of established dwellings on the market. This supply, which we estimate to be around a year's worth, reduces the need to build more new homes. Even more supply is likely to come on to the market this spring. It is a buyer's market.

In summary, the residential market is not undersupplied. Demand, at present at least, is also weak. Building it, alone, will not ensure success.

http://www.couriermail.com.au/news/opinion/australias-housing-market-not-undersupplied-says-michael-matusik/story-fn67k7wp-1225904008266

Michael Matusik writes a column in the saturday property liftout and now are available online

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As a result of more overseas migrants in the population mix, the average household size is increasing across Australia - and especially in Queensland, where the recent increase in overseas numbers has had a greater impact. New migrants live with, on average, one more person per household than older Australian households. The recent increase in household size reflects current demographic trends rather than housing stress.

Household size increasing is not something I expected to hear, as it really goes against the long term trend towards smaller household sizes. I'm not convinced that housing stress isn't playing a role, or more specifically, singles and single income families, have effectively been priced out of the market. Maybe prices need to fall for that trend to smaller households to continue. Certainly I can't afford one of those luxury apartments I see being built all over Sydney, even though they would be ideal for a single person like myself.

In addition, we have been over-consuming in housing for some time. According to the 2006 Census, one in 10 residential dwellings across Australia is unoccupied (830,000 in total) and the latest advertised dwellings for rent from RPData suggest that the national vacancy rate is well over 4 per cent, and even higher across Queensland.

That 1 in 10 figure is a touch misleading, as the census only measures houses that are empty at the time of the census. But, as I've posted elsewhere, a charity group did some work looking at water meter readings in a number of inner ring Melbourne suburbs to establish whether or not a house was occupied, and came up with a vacancy rate of around 7%, which is still quite large, and shows quite a bit of spare capacity out there.

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I read the article as vested interest vs vested interest. Ryder seems to be saying that the HIA lobbying to build more housing (and increased subsidies) is bad for property prices and investors and will decrease the already low yields. "Housing is already affordable so what is the problem?"

We're talking true vacancies here, not the "lies, damned lies and statistics" published by the real estate institutes.

This explains why rental growth has been so subdued.

Figures from Australian Property Monitors suggest Melbourne, Brisbane, Perth and Hobart all had less than 3 per cent growth in median house rentals in the year ending June.

Sydney and Adelaide rents grew little more than 4 per cent.

Darwin and Canberra were the standout performers with rental growth of about 8 per cent.

All of this is sober reading for property investors.

Even so it's fun watching property interests starting to eat each other in a slowing market. :)

Edited by staringclown

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Even so it's fun watching property interests starting to eat each other in a slowing market. :)

You'll love this one then!

You be the judge…are Lawyers Real Estate breaking the law or not?

by Greg Vincent, on 2nd September, 2010 • 12 Comments

19

► Retweet

As a licensed real estate agent within the state of NSW, if I was to open a business as Greg Vincent Lawyers or Greg Vincent Solicitors, etc without the right accreditations in place then how long do you think I could remain conducting a legal practice?

Yet, Peter Mericka of Lawyers Real Estate has either found a loop hole in the Victorian agency licensing legislation or Lawyers Real Estate has simply been placed into the too hard basket and has been allowed to continue to practice under the business name Lawyers Real Estate for the past 4 – 5 years without having undertaken any formal real estate licensing… That’s right! 4 – 5 years without a real estate license.

Either way, judging by Peter Mericka’s statement within his video on Today Tonight below and a letter from Robert Guthrie of the NSW Fair Trading Property Services Licensing posted on the Australian Real Estate Blog it would appear that Lawyers Real Estate may be looking to expand their real estate operation into other areas and possibly interstate.

Now I don’t know if it’s simply because of the name of his business that the industry bodies are too scared to take Peter Mericka on or whether there is in fact a loophole within the current Victorian legislation which entitles him to legally continue to operate in this manner as Lawyers Real Estate?

But if there is a loophole, is this business model what agents can expect to see more of into the future?

As a licensed agent I have invested a lot of time and money to achieve my licence and remain licensed.

I continue to pay annual renewal fees and have to undertake ongoing training to obtain the required CPD points required to continue to hold a real estate licence year after year. After watching the Today Tonight story about Lawyers Real Estate, I’m starting to wonder what on earth I’m paying the fees for.

More: http://www.business2.com.au/2010/09/you-be-the-judge%E2%80%A6is-lawyers-real-estate-breaking-the-law-or-not/

:jerry:

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Cool! :D This Peter Mericka guy has been attacking the REIV and RE in general for quite a while on his blog site. He must be really starting to get under their skin. :lol: Especially now that he is in competition with them.

Consumer Affairs Victoria - The Reason We Need A Corruption Commission!

REIV Hypocrisy - Cut Stamp Duty While Commissions Increase

REIV Pricing Ploy Relies On Lies

Enzo Raimondo - Auction System's Fair, You Can Quote Me

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He must be really starting to get under their skin. :lol:

I think things may be getting interesting?

Interesting that you should mention that they don't know what they've got themselves into, because yesterday afternoon I received a summons to the Supreme Court for a Directions hearing. CAV has caved in, and has decided to allow the court to make the decision. Up to now, CAV has regarded itself as the supreme authority, and has refused to put the matter before any tribunal other than itself. Now, we'll get an unbiased and uncorrupted decision on the matter.

# lawyer said on August 28, 2010 6:07 PM:

Peter would you care to put the directions summons on the blog so that we can all follow this interesting case

# Peter Mericka said on August 28, 2010 6:22 PM:

Hi Lawyer,

It's now time to insist that those who wish to have comments published on this posting should properly identify themselves.

Karl Scott is a lawyer who is personally known to me, and Bruce Atkinson has also identified himself.

So, those who have identified yourselves as "Lawyer", "David", Interested Observer" and "Educator" must contact me by email and provide me with a contact telephone number.

I don't know that it's appropriate to publish the summons, but I'm prepared to listen to arguments either way.

http://reic.com.au/blogs/australian_real_estate_blog/archive/2010/08/14/consumer-affairs-victoria-the-reason-we-need-a-corruption-commission.aspx

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An interesting exchange indeed. I await the outcome with interest.

I liked this comment

Hi Karl,

Thanks for your comments. As you can see, I'm having to deal with a couple of anonymous contributors who are full of fight but rather empty on arguments and taking responsibility for what they have to say.

They guy who calls himself "Interested Observer" has had his last two comments moderated (I haven't approved them for publication because they're offensive), and he has threatened to report me to Dr. Noone if I don't publish them. I can just imagine him sending the good Dr. a letter of complaint signed "Interested Observer".

Actually, I believe I know who "Interested Observer" is. I'm sure he's a disreputable lawyer I have had dealings with, and who sucks up to real estate agents like a vacuum cleaner on turbo mode.

I also believe "Educator" to be a guy who trains real estate agents and believes that he has the insight of a High Court judge when it comes to the question of lawyers selling real estate.

While they can be tedious at times, these guys do give some idea as to the mindset of those who oppose change in the industry.

Interesting that you should mention that they don't know what they've got themselves into, because yesterday afternoon I received a summons to the Supreme Court for a Directions hearing. CAV has caved in, and has decided to allow the court to make the decision. Up to now, CAV has regarded itself as the supreme authority, and has refused to put the matter before any tribunal other than itself. Now, we'll get an unbiased and uncorrupted decision on the matter.

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Interesting and it highlights the strange status of real estate agents in Australia compared with other places like the UK.

In the UK there is no licensing of estate agents whatsoever. They merely introduce buyers to sellers, their clients. Anyone can be an estate agent in the UK - no approval is required just as long as that person has not been banned by the Office of Fair Trading. There is an Estate Agents Act 1979 but it doesn't require any qualifications on the part of the agent. It just enforces certain practices. Estate agents in Britain tend not to get involved in contract matters for private treaty sales. Contract matters are an area for conveyancers and solicitors. This is where it seems to be different in Australia. Australian agents really do get involved in contract matters and perhaps over step into conveyancer/solicitor ground. The issue in the thread seems to be about a conveyancer stepping on estate agent's ground (whatever that is - beyond introducing a buyer). But I would have thought that the issue of estate agents treading on conveyancers ground in the contract area to be of much more concern from the customers interests.

Edited by Sally Periwinkle

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I thought we were 220,000 houses short. blush.gif

I tried to imagine what a 220,000 pad trailer park would look like and gave up, went to the Booze and Smokes Thread instead.

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Interesting and it highlights the strange status of real estate agents in Australia compared with other places like the UK.

In the UK there is no licensing of estate agents whatsoever. They merely introduce buyers to sellers, their clients. Anyone can be an estate agent in the UK - no approval is required just as long as that person has not been banned by the Office of Fair Trading. There is an Estate Agents Act 1979 but it doesn't require any qualifications on the part of the agent. It just enforces certain practices. Estate agents in Britain tend not to get involved in contract matters for private treaty sales. Contract matters are an area for conveyancers and solicitors. This is where it seems to be different in Australia. Australian agents really do get involved in contract matters and perhaps over step into conveyancer/solicitor ground. The issue in the thread seems to be about a conveyancer stepping on estate agent's ground (whatever that is - beyond introducing a buyer). But I would have thought that the issue of estate agents treading on conveyancers ground in the contract area to be of much more concern from the customers interests.

I agree. I don't mind that they require REA to undergo a basic level of training so much. At least they get a rudimentary understanding of property law. It's hard to imagine that a certificate 4 in property services is more comprehensive than a law degree though. Pretty sure that both contain an ethics component. The case should provide an indication of how much power the RE industry actually have in Victoria.

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Interesting and it highlights the strange status of real estate agents in Australia compared with other places like the UK.

In the UK there is no licensing of estate agents whatsoever. They merely introduce buyers to sellers, their clients. Anyone can be an estate agent in the UK - no approval is required just as long as that person has not been banned by the Office of Fair Trading. There is an Estate Agents Act 1979 but it doesn't require any qualifications on the part of the agent. It just enforces certain practices. Estate agents in Britain tend not to get involved in contract matters for private treaty sales. Contract matters are an area for conveyancers and solicitors. This is where it seems to be different in Australia. Australian agents really do get involved in contract matters and perhaps over step into conveyancer/solicitor ground. The issue in the thread seems to be about a conveyancer stepping on estate agent's ground (whatever that is - beyond introducing a buyer). But I would have thought that the issue of estate agents treading on conveyancers ground in the contract area to be of much more concern from the customers interests.

Although, do you really get what you pay for?

I paid about 1500-2000 GBP to the estate agent for selling my properties in the UK- I understand this is a tiny fraction of what you pay here- are Aussie agents 10-15x better?

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Although, do you really get what you pay for?

No*! $15k+ for sticking a sign in the window and another to the fence? <_<

* Well, you're paying (a lot) for very little, so I guess you do get what you pay for?

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Although, do you really get what you pay for?

I paid about 1500-2000 GBP to the estate agent for selling my properties in the UK- I understand this is a tiny fraction of what you pay here- are Aussie agents 10-15x better?

well, what's the percentage? aussie RE agents get about 2% of the sale price, plus passing on expenses like advertising -- and charging another fee for conducting auctions.

transfer costs in the US are even higher -- it's customary to use a buyer's agent AND a seller's agent at 3% each, and a mortgage broker can get another 3% there -- and typical costs of transfer including duties bring the average transfer cost to 12% of the house price.

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well, what's the percentage? aussie RE agents get about 2% of the sale price, plus passing on expenses like advertising -- and charging another fee for conducting auctions.

transfer costs in the US are even higher -- it's customary to use a buyer's agent AND a seller's agent at 3% each, and a mortgage broker can get another 3% there -- and typical costs of transfer including duties bring the average transfer cost to 12% of the house price.

Not uncommon to avoid a Buyers agent and go straight to the seller, though. In my experience the major cost difference here are costs of the "campaign" and "auction". Most other markets I am familiar with don't entertain those frilly extras. I'm always stunned on the RE Spruik shows i.e. Hot Property where the vendor is needing to hold out for another $10k. They just dumped $30k into a fancy sign, a shouting suit and a magazine ad (without price) that nobody reads. As prices stumble their way down this is where I'd suggest people needing to break even and get out should be looking to save.

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well, what's the percentage? aussie RE agents get about 2% of the sale price, plus passing on expenses like advertising -- and charging another fee for conducting auctions.

transfer costs in the US are even higher -- it's customary to use a buyer's agent AND a seller's agent at 3% each, and a mortgage broker can get another 3% there -- and typical costs of transfer including duties bring the average transfer cost to 12% of the house price.

In the UK it's Approx 1250 GBP flat fee for cheaper properties, for more expensive ones (GBP 200k-plus) it's 0.75 to 1.5% of the sale price, no fees until sold. This includes advertising on Rightmove.co.uk and in the local papers- as a minimum.

Mortgage brokers get 600-1000 GBP as commission. Buyer's agents are for multi-millionaires only.

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