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No. 76  
Lane Realty News Lane Realty News
    November Edition - 2010         November Edition - 2010    

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The Reserve Bank Does It Again

In what must surely be its most irresponsible decision to date, the Reserve hiked the interest rate by 0.25% on Melbourne Cup Day. The stated reasons for this decision, basically the mining boom, gave little real justification for the decision.

The Reserve Governors chose to ignore three other critical features in making this decision. First, the Australian Dollar has reached parity with the American Dollar for the first time in my memory, and probably ever. Yes, the USA is working quietly to reduce the value of its dollar to lower the pressure of the repayments it must make to China & also to try to make its industrial products more competitive on the world market. But, the Australian Dollar should not be at parity. It is very bad for our exporters, especially our primary industries & our weak manufacturing base.

The second strong reason against an interest rise was the underlying low inflation figure. There is not one shred of evidence to suggest that Australia was in any danger of accelerating inflation in any reports that have been provided over the past few months. Indeed, current inflation figures are well within the range the Reserve Bank had already stated to be acceptable.

The third factor that the Reserve totally ignored, was the parlous state of the housing industry. This industry is the backbone of Australia & it was already in serious decline prior to the Melbourne Cup Day decision.

Logic seems to be badly missing from the Reserve Bank Board’s thinking. Most of those economists are the product of University economics teaching of the 1960s & 70s. And it was pure drivel!

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Where Now For The Property Industry?

It appears that the Reserve has decided that we, the Australian people, are just too rich. The Reserve Board seems to think that for what is for most people the one & only major asset, needs to be devalued. There can only be one result from this latest interest rate rise & that is a further drop in home values around the nation.

At least the damage will be national rather than local, so people on the move will face both loss of value on the sales side as well as lower pricing on the purchase side.

Prices are going to drop everywhere as more potential buyers are forced out of the market while others who could afford to buy decide to sit out & wait.

Some sellers do have options in these market conditions. They can decide to stay put, pull their homes from the market & wait for a more opportune time. Or they can decide to go with the flow & meet the market.

People for whom moving is not an option really have no choice. They will need to face up to the situation & price their home at a level that will attract one of the much reduced number of active buyers in the marketplace.

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And What’s Happening In The Market?

Simply put, property values are nose diving. Lack of demand has just pulled the rug right out from under what we presumed were “current market values”. Let me give just 2 examples.

One local agency auctioned off a block of land in OLD Eagle Heights that had some commercial potential. It had been on the market for a considerable time at $285,000. Yes, it was too dear, but nobody could have expected to see it sell under the hammer for $165,000.

The second example was a fine 8 acre property on the eastern cliff edge with magical privacy & views. Although the home was older, it had been done up very well & certainly had a lot of appeal. It had been overpriced at $2.7 million. Lane Realty had considered around $1.8 million as a realistic price. A major off-Mountain agency took it to auction as a deceased estate & sold it for $1.45 million.

The major agency involved also indicated that that day’s huge auction did not achieve anything like the clearance of properties that it is accustomed to obtaining.

These results quite clearly indicate that property prices are tumbling. They also suggest that auctioning, with its added expenses, may not be the wisest move. It never is on a falling market.

The ONLY real winners under these market conditions are buyers with cash in hand. The next few weeks & months ahead looks like a fertile field for people in a position to take advantage of the financial situation.

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Spotlight on: 102 Contour Drive

Red Light Special

Beautiful Home - Panoramic Views
http://www.lanerealty.com.au/lr11785.html
For a personal viewing contact: Barry Chick - phone: 5545 1800 / 04 1887 6191
or e-mail: barry@lanerealty.com.au

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The Mountain Market Is Suffering More Than Normal

The weather always has some impact on real estate market activity on Tamborine Mountain. The general level of expectation is that the demand for Mountain properties rises with the temperature. The hotter & more steamy it becomes down on the lowlands of Brisbane & the Gold Coast, the more people look to this area for cooler relaxation & living. A good burst of early summer heat & humidity in October usually boosts sale numbers.

As a typical summer continues on, more & more people visit the Mountain, discover what it has to offer, or remind themselves that it is the nicest place to live. Some of those visitors actually do become buyers. With this climatic advantage on our side, sales rates continue to stay strong as the summer months progress.

So far, it has been a cool, wet start to spring & summer with weekend after weekend being cold, cloudy & wet. We have not yet seen a even a small burst of typical summer weather. Visitor numbers have plummeted due to the lack of fine, hot weekends. So potential buyers who might have driven up to cool off have been staying away in droves. People are not feeling any impulse to come to the Mountain & experience its much more moderate climate because they don’t need to do so.

Normally we would expect that this abnormal weather would soon come back to the usual summer reality, but long term weather forecasters seem to think that this La Nina season is going to be mostly mild & wet. This is not good news for local area sellers or agents! It is also not great news for local landlords as potential tenants are not feeling the usual strong impetus to move to higher ground either.

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It’s Not Too Late To Give Friends & Family A Christmas Gift They Will Love

Give them the gift of a break in one of Lane Realty’s Holiday Cottages

Pick the Holiday House you want, decide on the number of days stay to pay for & you will be given a specially made Christmas Gift Voucher that you can put under the tree or mail off instead of a Christmas Card - please email Nina for bookings

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Zig On Growing Older

I hate to tell you, but I have reached that stage of being a mature dog! Now I am lucky, my health is good. I can still chase the cats up & down the hallway, try to pull the head off the vacuum cleaner & generally do all the things I’ve always enjoyed doing. But these days I sometimes fail to hear the car arrive when I have been left at home. Now I tell myself there is nothing wrong with my hearing - it was just that I was in a very deep relaxing sleep!

Sometimes I am sleeping so soundly I don’t hear the possums on the roof at night. In days of yore I always woke the entire household to say that demons were on our roof trying to get in. I never used to snore either, but now Mummy has to listen to decide whether it is Daddy snoring or me. Mind you, her hearing (& snoring!) is not the best either. She says it is because she was born a bit low on the hearing side & that was made worse by a very bad ear infection about 10 years ago. Excuses! Excuses!

At least my eyes are still good. I don’t have to wear glasses & can still see another dog to bark at.

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From Helen’s Kitchen ... Savoury Mango & Strawberry Salad

Ingredients
2 ripe firm mangoes
1 punnet strawberries
1 small red spanish onion
Dressing
1 tablespoon sugar
3 teaspoons grated ginger
Juice of 1 lime

Mix dressing ingredients together in a jar & shake well. Leave to stand while preparing the fruits.

Peel & chop mango into cubes. Hull & slice strawberries fairly thinly. Thinly slice the onion into half round rings.

Shake the dressing again and drizzle over the salad. Gently toss the salad. Cover & refrigerate until ready for use. Can stand for a few hours to develop full flavour.

Serve with grilled / BBQed fish, pork or lamb for a very different gourmet meal.

Serves 4

NOTE: Some people add chillies to this salad. It all depends on your taste buds!

NOTE: Avoid the excruciating agony of grazed knuckles and invest in one of those porcelain ginger graters. Grates well and cleans easily.

Nutrition (1 serve): 353 kj (84 cal) / carbohydrate (mainly low GI) 17.4 g

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ToP The recipes published in “From Helen's Kitchen” have been archived on separate Recipe Pages.
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Last updated 4 November, 2010
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