1 00:00:12,400 --> 00:00:15,560 Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:15,640 --> 00:00:18,720 Speaker 1: James Kirby, the Wealth editor at The Australian, and welcome 3 00:00:18,760 --> 00:00:22,760 Speaker 1: aboard everybody. Now you may have noticed that there is 4 00:00:23,000 --> 00:00:27,120 Speaker 1: the beginning of a trend of a turn actually in 5 00:00:27,160 --> 00:00:31,160 Speaker 1: the property market as we speak, and you'd already know. 6 00:00:31,280 --> 00:00:35,319 Speaker 1: I'm sure the property prices are beginning to fall in 7 00:00:35,400 --> 00:00:40,120 Speaker 1: both Sydney and Melbourne. Now those falls are small, but 8 00:00:40,159 --> 00:00:42,880 Speaker 1: the point is they're falling right, they're going the wrong 9 00:00:42,920 --> 00:00:46,320 Speaker 1: way and very roughly it looks at the current pace 10 00:00:46,360 --> 00:00:49,879 Speaker 1: of something like one percent a month. The couple of 11 00:00:49,920 --> 00:00:52,559 Speaker 1: issues major issues for anyone in property is how far 12 00:00:52,600 --> 00:00:55,000 Speaker 1: will this go? And how wide will this go? Will 13 00:00:55,040 --> 00:00:57,480 Speaker 1: it spread to the other cities that have been having 14 00:00:57,560 --> 00:01:00,600 Speaker 1: such a good run in recent times, Perth and Brisbane 15 00:01:00,640 --> 00:01:03,320 Speaker 1: in particular, and Adelaide too, So we want to have 16 00:01:03,360 --> 00:01:04,840 Speaker 1: a look at that, and I want to take a 17 00:01:04,920 --> 00:01:09,720 Speaker 1: quick look also at the long awaited, finally signed off 18 00:01:10,560 --> 00:01:14,880 Speaker 1: shared equity scheme, where you or someone you know can 19 00:01:15,480 --> 00:01:18,959 Speaker 1: now buy a home in conjunction if you like, in 20 00:01:19,000 --> 00:01:21,480 Speaker 1: a joint venture with the government, so you and the 21 00:01:21,520 --> 00:01:23,880 Speaker 1: government can share the ownership of a home they will 22 00:01:23,880 --> 00:01:27,480 Speaker 1: put up up to forty percent of the price of 23 00:01:27,480 --> 00:01:30,479 Speaker 1: it if it's a new house, thirty percent of it's 24 00:01:30,480 --> 00:01:34,080 Speaker 1: an existing house. What's that like? Is it a good idea? 25 00:01:34,200 --> 00:01:36,160 Speaker 1: Would it work for you? Would it work at all? 26 00:01:36,840 --> 00:01:38,920 Speaker 1: My guest today is a regular on the show. It's 27 00:01:38,959 --> 00:01:41,640 Speaker 1: Louis Christopher of SQM Research. How are you, Louie? 28 00:01:42,120 --> 00:01:43,720 Speaker 2: Good Bye? They're giants. It has to be with you 29 00:01:43,760 --> 00:01:44,240 Speaker 2: once again. 30 00:01:44,560 --> 00:01:47,080 Speaker 1: Good to be with you. So just let's tell the 31 00:01:47,080 --> 00:01:49,880 Speaker 1: listeners basically your call on where things are? First of all, 32 00:01:50,320 --> 00:01:52,480 Speaker 1: is that about right? Price is following about one percent 33 00:01:52,520 --> 00:01:53,840 Speaker 1: a month now. 34 00:01:54,240 --> 00:01:56,800 Speaker 2: Or just on the one percent a mile for Sydney 35 00:01:57,000 --> 00:02:02,440 Speaker 2: and Melbourne prizes on Alan numbers are also falling Canberra 36 00:02:03,120 --> 00:02:07,720 Speaker 2: into a let's say, Steeds in Hobart, but they are 37 00:02:07,760 --> 00:02:12,280 Speaker 2: still rising out a very strong click for Perth. Brisbane 38 00:02:12,720 --> 00:02:16,079 Speaker 2: had laid when we believe that the Darwin market's actually 39 00:02:16,120 --> 00:02:18,640 Speaker 2: sewn to pick up now. So but most of the 40 00:02:18,639 --> 00:02:21,760 Speaker 2: falls we speak of that the people here about in 41 00:02:21,800 --> 00:02:25,359 Speaker 2: the media are really Sydney and Goldblin stories. 42 00:02:24,960 --> 00:02:27,840 Speaker 1: Here and the majority of housing sock is in Sydney 43 00:02:27,880 --> 00:02:30,160 Speaker 1: and Melbourne. This did I think you said sixty percent 44 00:02:30,280 --> 00:02:30,520 Speaker 1: or so. 45 00:02:30,639 --> 00:02:32,519 Speaker 2: About sixty percent of the national spot. 46 00:02:33,160 --> 00:02:36,680 Speaker 1: So there is I think it's Shane Oliver at AMP 47 00:02:37,240 --> 00:02:39,160 Speaker 1: mentioning and a few others putting out the point they're 48 00:02:39,160 --> 00:02:42,000 Speaker 1: pretty soon we're going to see a nationwide average fall 49 00:02:42,280 --> 00:02:46,360 Speaker 1: in prices. Is that feasible or pushing it too much? 50 00:02:48,080 --> 00:02:52,040 Speaker 2: Look, we have a different view. We think for twenty 51 00:02:52,120 --> 00:02:55,359 Speaker 2: twenty five we're not going to see a broad based 52 00:02:55,480 --> 00:02:59,520 Speaker 2: national cly. We still believe that the seeds are per 53 00:03:00,320 --> 00:03:03,640 Speaker 2: and adelaide will we call rises our bed slower rises 54 00:03:03,680 --> 00:03:06,680 Speaker 2: and what we're recorded in what has been recorded in 55 00:03:06,720 --> 00:03:10,519 Speaker 2: twenty twenty four, and that the falls will be for 56 00:03:10,919 --> 00:03:15,480 Speaker 2: just certain cities being Melbourne, Sydney, as Weuching before, Hobarts 57 00:03:15,520 --> 00:03:17,840 Speaker 2: and canber So we don't think there's tend to be 58 00:03:17,840 --> 00:03:22,680 Speaker 2: a broad based and actual decline, mainly because we're seeing 59 00:03:22,840 --> 00:03:28,639 Speaker 2: certain state economies doing better than others and population into 60 00:03:28,680 --> 00:03:33,919 Speaker 2: state population migration flows are stronger than certain states and others, 61 00:03:33,960 --> 00:03:37,840 Speaker 2: meaning that underlying demand is stilling freezing at a fairly 62 00:03:37,960 --> 00:03:41,320 Speaker 2: rapid rate of knots, for example in the state of 63 00:03:41,400 --> 00:03:45,640 Speaker 2: Western Australia's state of Queensland, and that underlying demand for 64 00:03:45,800 --> 00:03:49,120 Speaker 2: housing has not been met on the supply side. So 65 00:03:49,760 --> 00:03:52,360 Speaker 2: these are one of the reasons why we're forecasting in 66 00:03:52,440 --> 00:03:54,920 Speaker 2: more of a mixed house in market in twenty twenty five. 67 00:03:55,640 --> 00:04:00,320 Speaker 1: Okay, And what's interesting here, obviously is you've put the 68 00:04:00,440 --> 00:04:04,720 Speaker 1: end alongside Melbourne as a market that you expect to 69 00:04:04,720 --> 00:04:07,520 Speaker 1: see a forward by the far end of twenty twenty five. 70 00:04:07,600 --> 00:04:08,960 Speaker 1: Can you tell us a little bit more about what 71 00:04:09,000 --> 00:04:09,800 Speaker 1: you're forecasting. 72 00:04:10,440 --> 00:04:13,960 Speaker 2: Yeah, sure, So for Sydney and Melville we're forecasts and 73 00:04:14,040 --> 00:04:17,440 Speaker 2: housing price declined to somewhere between minus one to minus 74 00:04:17,480 --> 00:04:20,360 Speaker 2: five percent for the year. Now, what we believe will 75 00:04:20,400 --> 00:04:23,719 Speaker 2: actually happen is that the bulk of the housing price 76 00:04:23,800 --> 00:04:26,320 Speaker 2: falls will happen in the first half of the year. 77 00:04:27,240 --> 00:04:29,800 Speaker 2: We believe at some point in time in mid year 78 00:04:29,839 --> 00:04:32,440 Speaker 2: twenty twenty five, we're finally going to see the Reserve 79 00:04:32,520 --> 00:04:36,680 Speaker 2: Bank of Australia cut each astraits and once they do, 80 00:04:36,839 --> 00:04:40,559 Speaker 2: we do believe that at home by confidence, indeed vendor 81 00:04:40,640 --> 00:04:44,479 Speaker 2: conferimence will start to prove in our two largest capital 82 00:04:44,520 --> 00:04:48,560 Speaker 2: cities for the second half of twenty twenty five, but 83 00:04:48,640 --> 00:04:52,200 Speaker 2: the net result will still be declines in housing prices 84 00:04:52,279 --> 00:04:55,600 Speaker 2: recorded full of full year. So just think of an 85 00:04:55,600 --> 00:04:59,359 Speaker 2: impartial V shaped recovery for our two largest capital cities 86 00:04:59,400 --> 00:05:02,240 Speaker 2: where falls having the first half the year off set 87 00:05:02,240 --> 00:05:04,680 Speaker 2: by some price increases for the second half of a year. 88 00:05:06,040 --> 00:05:08,640 Speaker 1: You would know, of course, that most of the major 89 00:05:08,640 --> 00:05:12,679 Speaker 1: bank economists have now pushed their forecast for a record 90 00:05:12,760 --> 00:05:16,599 Speaker 1: out from February March right out to May June. The 91 00:05:16,720 --> 00:05:19,080 Speaker 1: risk I imagine for you is that they would push 92 00:05:19,120 --> 00:05:22,640 Speaker 1: them further out again. Is that a downside risk basically 93 00:05:22,720 --> 00:05:24,120 Speaker 1: for your forecast? 94 00:05:24,880 --> 00:05:29,080 Speaker 2: Well, you may recall and your audience may recall what 95 00:05:29,160 --> 00:05:32,320 Speaker 2: we do when we release these forecasts each years. We 96 00:05:32,360 --> 00:05:36,680 Speaker 2: put out various scenarios, and so our base pas scenario 97 00:05:36,839 --> 00:05:39,360 Speaker 2: was that we would see our interest rate cut of 98 00:05:39,560 --> 00:05:42,599 Speaker 2: betwey point two five percent two point five percent somewhere 99 00:05:42,720 --> 00:05:47,800 Speaker 2: media twenty five. However, our second most likely scenario is 100 00:05:47,839 --> 00:05:51,280 Speaker 2: one where the Reserve Bank WASTRA doesn't cut egestrates in 101 00:05:51,360 --> 00:05:55,159 Speaker 2: twenty twenty five at all. And our that scenario we're 102 00:05:55,200 --> 00:05:58,120 Speaker 2: a little bit more negative on the housing market book, 103 00:05:58,160 --> 00:06:02,040 Speaker 2: particularly City and Melbourne. So on our modeling, the RBA 104 00:06:02,240 --> 00:06:05,880 Speaker 2: does not cut rates in twenty twenty five, housing prices 105 00:06:05,920 --> 00:06:08,640 Speaker 2: in City and Melbourne are likely to fall somewhere between 106 00:06:08,680 --> 00:06:11,640 Speaker 2: seven to eight per seat for the full calendar year. 107 00:06:12,680 --> 00:06:15,680 Speaker 1: Okay, and it has happened. I presume before that you 108 00:06:15,760 --> 00:06:18,880 Speaker 1: had a year where the major cities were dropping and 109 00:06:19,040 --> 00:06:22,839 Speaker 1: the other cities were rising. That's not unprecedented normally. 110 00:06:23,160 --> 00:06:27,400 Speaker 2: The situation you do recall, are you one records over 111 00:06:27,680 --> 00:06:29,800 Speaker 2: over a number of years now is a mixed housing 112 00:06:29,920 --> 00:06:33,720 Speaker 2: market where some cities right, some cities fall. It's more 113 00:06:33,760 --> 00:06:37,960 Speaker 2: the abnormality that you see every housing market across Australia 114 00:06:38,360 --> 00:06:41,760 Speaker 2: in sec with housing price falls. Of course, there are 115 00:06:41,800 --> 00:06:45,640 Speaker 2: periods where when the Reserve Bank Australias lifted interest rates 116 00:06:45,680 --> 00:06:49,160 Speaker 2: and all the economy significantly slow that you see slowing 117 00:06:49,240 --> 00:06:55,440 Speaker 2: housing markets across the capital cities, but England that case, 118 00:06:55,800 --> 00:06:59,920 Speaker 2: it's not always a situation where housing fives falls literally 119 00:07:00,080 --> 00:07:03,120 Speaker 2: happen everywhere, and I really do doubt we'll see that. 120 00:07:03,640 --> 00:07:06,599 Speaker 2: I think in Australia next to you, I think you know. 121 00:07:06,680 --> 00:07:10,600 Speaker 2: One of the cue missing ingredies behind big fools in 122 00:07:10,680 --> 00:07:13,640 Speaker 2: housing prices nationwide is that we still have a shortage 123 00:07:13,640 --> 00:07:17,320 Speaker 2: of real estate. It's not like a zo. The supply 124 00:07:17,640 --> 00:07:21,640 Speaker 2: side on residial will stay in this country is boomy. 125 00:07:21,800 --> 00:07:25,880 Speaker 2: It isn't everyone's aware. We've got a fundamental of shortage 126 00:07:25,920 --> 00:07:29,560 Speaker 2: of real estate compared to the population growth rate, and 127 00:07:29,800 --> 00:07:32,640 Speaker 2: that essentially puts a bit of our floor underneath the 128 00:07:32,680 --> 00:07:34,560 Speaker 2: housing market to an extate. 129 00:07:34,680 --> 00:07:46,120 Speaker 1: Okay, we'll be back in a moment. Hello, Welcome back 130 00:07:46,120 --> 00:07:48,880 Speaker 1: to The Australian's Money Puzzle podcast. I'm James Kirby. I'm 131 00:07:48,920 --> 00:07:51,920 Speaker 1: talking to Louis Christopher. Okay, Louis, this is what everyone 132 00:07:51,960 --> 00:07:54,560 Speaker 1: wants to know. Where are the bargains in Melbourne's Sydney 133 00:07:55,680 --> 00:07:59,880 Speaker 1: Because as our audience, they're investors, they're optimists, they're looking 134 00:07:59,920 --> 00:08:03,440 Speaker 1: for value. So can we deal with them separately. Let's 135 00:08:03,480 --> 00:08:05,160 Speaker 1: have a look at Melbourne. First of all, let's be. 136 00:08:05,720 --> 00:08:08,559 Speaker 2: Well chah, well we can, but we're seeing some similar trends. 137 00:08:08,680 --> 00:08:12,480 Speaker 2: Let me explain it. Okay. Firstly, firstly, for both seas, 138 00:08:12,840 --> 00:08:15,600 Speaker 2: I wouldn't say that that the markets are undervaged at 139 00:08:15,600 --> 00:08:18,360 Speaker 2: this point in time. So when we look at pricess 140 00:08:18,400 --> 00:08:22,800 Speaker 2: to rens pricess of income, we're still recording other valuations 141 00:08:22,840 --> 00:08:25,600 Speaker 2: in Melbourne and c but the market is colling off 142 00:08:26,520 --> 00:08:30,280 Speaker 2: and we are seeing more distress listings activity, particularly in 143 00:08:30,320 --> 00:08:33,720 Speaker 2: the state of Victoria. And then we went dig deeper 144 00:08:33,840 --> 00:08:37,520 Speaker 2: into the stud of Victoria. The bulk of those distress 145 00:08:37,640 --> 00:08:41,320 Speaker 2: listings are occurring any inner city areas of Melbourne. We 146 00:08:41,440 --> 00:08:46,000 Speaker 2: are recording some distress listening to regional Victoria, but the 147 00:08:46,040 --> 00:08:50,040 Speaker 2: bulk of the are in Melbourne and that they're they're 148 00:08:50,160 --> 00:08:53,160 Speaker 2: involving apartments in the CBD. 149 00:08:53,440 --> 00:08:56,960 Speaker 1: Okay, what's your definition of distress our? 150 00:08:57,000 --> 00:09:00,920 Speaker 2: Distress listening is one where we're noticed frutile listing. It's 151 00:09:00,960 --> 00:09:04,920 Speaker 2: been either advertised as lortgage in possession or season the 152 00:09:05,000 --> 00:09:10,160 Speaker 2: ad bank for sale or deceased a state or all 153 00:09:10,240 --> 00:09:14,720 Speaker 2: offers considered must sell. Now we think at about forty 154 00:09:14,760 --> 00:09:17,920 Speaker 2: seven different keywords in terms of what we're regarded as 155 00:09:17,920 --> 00:09:18,800 Speaker 2: of distress listing. 156 00:09:19,480 --> 00:09:21,520 Speaker 1: What are you able to give us some sense of 157 00:09:22,200 --> 00:09:26,840 Speaker 1: the proportion of property in Melbourne and Central that's distressed 158 00:09:26,960 --> 00:09:28,760 Speaker 1: and what it might be normally. 159 00:09:28,920 --> 00:09:31,400 Speaker 2: In the CVD. I think we're recording now about one 160 00:09:31,480 --> 00:09:34,160 Speaker 2: hundred and ten properties. So in the post got A 161 00:09:34,200 --> 00:09:37,160 Speaker 2: three thousand has about one hundred and ten properties selling 162 00:09:37,240 --> 00:09:38,679 Speaker 2: under distress conditions. 163 00:09:38,800 --> 00:09:41,680 Speaker 1: Okay, what would you expect normally? 164 00:09:43,120 --> 00:09:45,520 Speaker 2: Well put it this way, James, it's a relatively new 165 00:09:45,640 --> 00:09:47,680 Speaker 2: series that we've put out, so we've been running this 166 00:09:47,800 --> 00:09:54,959 Speaker 2: distress listings index since weeky twenty and for most states 167 00:09:55,160 --> 00:09:58,280 Speaker 2: that this number of distress listings are well down in 168 00:09:58,320 --> 00:10:02,880 Speaker 2: those COVID times early COVID times, except for the state 169 00:10:02,920 --> 00:10:07,640 Speaker 2: of Victoria. We've now recorded and new've hed for the 170 00:10:07,920 --> 00:10:10,679 Speaker 2: chount of the stress listings in the state of Victoria, 171 00:10:10,880 --> 00:10:13,000 Speaker 2: so that the numbers now are coming out to twelve 172 00:10:13,080 --> 00:10:18,439 Speaker 2: hundred properties statewide which are selling under distress conditions as 173 00:10:18,520 --> 00:10:21,600 Speaker 2: per our recordings, and that's higher than what we had 174 00:10:21,840 --> 00:10:25,240 Speaker 2: during the COVID period. Now, there was this period between 175 00:10:25,280 --> 00:10:28,600 Speaker 2: twenty twenty one and twenty twenty two Victoria and as 176 00:10:28,600 --> 00:10:30,720 Speaker 2: it was a case of other states, where the stress 177 00:10:30,760 --> 00:10:35,440 Speaker 2: listening activity essentially collapsed. And that was because during that time, 178 00:10:35,480 --> 00:10:39,000 Speaker 2: you may recall, the banks had a lratorial on any 179 00:10:39,480 --> 00:10:44,120 Speaker 2: borrowers who were facing financial hardship to the COVID. Hope. 180 00:10:44,760 --> 00:10:47,600 Speaker 2: Those times have ended, of course, and the banks are 181 00:10:47,600 --> 00:10:48,720 Speaker 2: now playing hardball. 182 00:10:48,800 --> 00:10:52,520 Speaker 1: They were given a sort of lifeline at that time. Yeah, three, 183 00:10:53,120 --> 00:10:57,280 Speaker 1: I see. And what about in your reporter just came 184 00:10:57,280 --> 00:10:59,840 Speaker 1: out this morning, you say total listings. Now, this is nation, 185 00:11:00,120 --> 00:11:04,800 Speaker 1: they presume, but presume it's it's underpin by Victoria. So 186 00:11:04,960 --> 00:11:08,040 Speaker 1: total listings rules by seven point six percent, driven by 187 00:11:08,440 --> 00:11:12,320 Speaker 1: sharp rises in old listings. I assume that is just 188 00:11:12,400 --> 00:11:15,640 Speaker 1: the accumulation of stuff coming back on the market again 189 00:11:15,679 --> 00:11:17,240 Speaker 1: and again. Is that what that means? 190 00:11:17,640 --> 00:11:20,160 Speaker 2: Yeah, Bold listenings week class of by old listenings has 191 00:11:20,240 --> 00:11:22,640 Speaker 2: been on the market for over six months, well one 192 00:11:22,720 --> 00:11:26,079 Speaker 2: hundred and eighty days, and you would be surprised how 193 00:11:26,120 --> 00:11:28,839 Speaker 2: me listening shout there and being on the market that role. 194 00:11:29,679 --> 00:11:34,800 Speaker 2: We're counting nationwide there's about seventy four thousand listings that have 195 00:11:34,880 --> 00:11:38,400 Speaker 2: been on the lark for greater than six months. But 196 00:11:38,440 --> 00:11:42,360 Speaker 2: more interestingly, the properties that have been on the market 197 00:11:42,440 --> 00:11:48,000 Speaker 2: between thirty days to ninety days rose significantly over the 198 00:11:48,200 --> 00:11:51,880 Speaker 2: last thirty days. They're kind of went up by twenty 199 00:11:51,880 --> 00:11:55,520 Speaker 2: two percent nationwide. And what that's telling us is that 200 00:11:55,600 --> 00:11:59,360 Speaker 2: it's been a very disappointing spring selling seats in the 201 00:11:59,440 --> 00:12:04,000 Speaker 2: cross country for many owners and agents alike, particularly once 202 00:12:04,040 --> 00:12:07,120 Speaker 2: again in city of Melbourne, where we've recorded the biggest 203 00:12:07,200 --> 00:12:10,440 Speaker 2: gains in that bracket of listings in terms of days 204 00:12:10,440 --> 00:12:10,839 Speaker 2: of laughter. 205 00:12:11,520 --> 00:12:15,600 Speaker 1: Right, so the weekness in Melbourne is inter city apartments clearly. 206 00:12:16,200 --> 00:12:17,720 Speaker 1: Is that reflected in Sydney too. 207 00:12:18,080 --> 00:12:21,320 Speaker 2: Yes, it is. We're also recording rise in the stress 208 00:12:21,360 --> 00:12:26,800 Speaker 2: listing activity in the cvdal City. We're also being recording 209 00:12:26,920 --> 00:12:31,760 Speaker 2: rises and distress selling activity in development areas in and 210 00:12:31,800 --> 00:12:36,240 Speaker 2: around city. So for example, in Northwest City, particularly around 211 00:12:36,240 --> 00:12:40,559 Speaker 2: the carling For and Epping area, we're recording of substantial 212 00:12:40,679 --> 00:12:43,000 Speaker 2: rise and distress listing to activity, and that's been an 213 00:12:43,040 --> 00:12:46,720 Speaker 2: area where there's been a lot of developments being added 214 00:12:46,760 --> 00:12:50,840 Speaker 2: on to the market over the past three to five years. 215 00:12:51,400 --> 00:12:54,360 Speaker 1: Okay, I want to ask you one point about that Sydney. 216 00:12:54,920 --> 00:12:59,000 Speaker 1: The softness in the Sydney inner city apartment market. Is 217 00:12:59,120 --> 00:13:02,240 Speaker 1: it also worse than the COVID period. 218 00:13:03,559 --> 00:13:05,480 Speaker 2: Yes, it is. It's worse than a COVID period. 219 00:13:05,520 --> 00:13:08,280 Speaker 1: Now, Okay, I see. So the explanation is not so 220 00:13:08,400 --> 00:13:11,400 Speaker 1: much that it's so bad now, it's that there was 221 00:13:11,480 --> 00:13:14,720 Speaker 1: this artificial cushion in the COVID period where the banks 222 00:13:14,720 --> 00:13:15,560 Speaker 1: weren't allowed move. 223 00:13:15,679 --> 00:13:20,000 Speaker 2: Basically, yes, that is true, and we need to okig 224 00:13:20,040 --> 00:13:22,800 Speaker 2: in mind that you know, we'd go relatively young series 225 00:13:22,800 --> 00:13:25,720 Speaker 2: out there. We're not only everyone else that does this series. Yeah, 226 00:13:25,800 --> 00:13:28,720 Speaker 2: but you know, I really entire in this series will mature. 227 00:13:29,200 --> 00:13:31,120 Speaker 2: So we've only got the data back to twenty twenty, 228 00:13:31,160 --> 00:13:34,320 Speaker 2: so make of that what you will. But nevertheless, suddenly 229 00:13:34,320 --> 00:13:37,040 Speaker 2: in the start of Victoria we're in now unchartered orders 230 00:13:37,240 --> 00:13:40,679 Speaker 2: and we also now there's been separate reports of increased 231 00:13:41,320 --> 00:13:44,040 Speaker 2: defaults and the rears in the start of victory as well. 232 00:13:44,080 --> 00:13:46,200 Speaker 2: I think you know, being in Isaiah cang out with 233 00:13:46,240 --> 00:13:48,360 Speaker 2: some surveys on that recently. 234 00:13:48,720 --> 00:13:53,480 Speaker 1: Yes, and Fitch did also Louis on that side of things. Okay, 235 00:13:53,600 --> 00:13:56,080 Speaker 1: very interesting. I just want to ask you whether you 236 00:13:56,160 --> 00:13:59,559 Speaker 1: think investors would necessarily see in the city apartment markets 237 00:13:59,600 --> 00:14:02,240 Speaker 1: as at what point would they see it as being 238 00:14:02,280 --> 00:14:07,000 Speaker 1: in bargain territory because they are known to be among 239 00:14:07,040 --> 00:14:10,360 Speaker 1: the weakest of property types because of basically because there's 240 00:14:10,360 --> 00:14:10,760 Speaker 1: no land. 241 00:14:11,320 --> 00:14:14,800 Speaker 2: Great very hard and at a personal level, it's not 242 00:14:15,240 --> 00:14:18,520 Speaker 2: our location. I would personally investing myself because of the 243 00:14:19,080 --> 00:14:22,600 Speaker 2: what I do regardless well, being will elevate the risks 244 00:14:22,640 --> 00:14:26,280 Speaker 2: of boons and buss as opposed to more smooth our 245 00:14:26,400 --> 00:14:33,000 Speaker 2: performance from an investment perspective. Yeah. Look, these areas, of 246 00:14:33,000 --> 00:14:36,000 Speaker 2: course will be historically areas where you see more supply 247 00:14:36,040 --> 00:14:41,280 Speaker 2: added into the marketplace. We are definitely notice more resales 248 00:14:41,280 --> 00:14:46,360 Speaker 2: occurring below the initial purchase price, particularly in Melbourne. We 249 00:14:46,480 --> 00:14:48,600 Speaker 2: ran one last week in our what we call our 250 00:14:48,760 --> 00:14:52,880 Speaker 2: stress Property of the Week and our weekly ESQR newsletter. 251 00:14:52,960 --> 00:14:56,200 Speaker 2: It was a property by recall where the initial purchase 252 00:14:56,280 --> 00:14:58,840 Speaker 2: price was back in twenty fifteen at about eight hundred 253 00:14:58,840 --> 00:15:01,720 Speaker 2: and fifty thousand dollars or three bid or in the unit, 254 00:15:01,760 --> 00:15:03,720 Speaker 2: and then they are trying to pick it up. Well, 255 00:15:03,720 --> 00:15:06,480 Speaker 2: they try to sell it somewhere in the six hundred 256 00:15:06,480 --> 00:15:09,120 Speaker 2: thousand range of boy Cuble numbers, so it was a 257 00:15:09,240 --> 00:15:13,200 Speaker 2: deep discount to the original purchase price. You could argue 258 00:15:13,280 --> 00:15:17,160 Speaker 2: that the original purchase price, which I presumably was bought 259 00:15:17,160 --> 00:15:19,920 Speaker 2: off the plane, was way above mark above laying. This 260 00:15:19,960 --> 00:15:22,359 Speaker 2: is the issue I have ab off the plane valuations. 261 00:15:22,640 --> 00:15:25,640 Speaker 2: It is very hard to tell what is speed market valuation, 262 00:15:26,600 --> 00:15:29,680 Speaker 2: and there are greater risks for investors buying off the 263 00:15:29,680 --> 00:15:32,560 Speaker 2: plane that they're paying arger the odds for the property concerned. 264 00:15:33,200 --> 00:15:36,120 Speaker 1: Okay, very interesting. I'm sure the listeners will take all 265 00:15:36,120 --> 00:15:38,760 Speaker 1: that on board. Very interesting. Okay, Now, just before we 266 00:15:38,840 --> 00:15:41,880 Speaker 1: got questions, if I could just swing your attention in 267 00:15:42,320 --> 00:15:46,680 Speaker 1: another direction entirely the Shared Home Equity Scheme, which is 268 00:15:46,720 --> 00:15:52,000 Speaker 1: the Labor Government's signature or move to put something in 269 00:15:52,080 --> 00:15:55,240 Speaker 1: for first home buyers got signed off in the last 270 00:15:55,280 --> 00:15:57,800 Speaker 1: week of Parliament and it will now start and it 271 00:15:57,840 --> 00:16:00,240 Speaker 1: would allow people to let the government basically to be 272 00:16:00,280 --> 00:16:03,600 Speaker 1: the other partner in the purchase of a home first 273 00:16:03,640 --> 00:16:06,480 Speaker 1: home forty percent. The government could have up to forty 274 00:16:06,480 --> 00:16:09,080 Speaker 1: percent of a new property and thirty percent of an 275 00:16:09,080 --> 00:16:12,080 Speaker 1: existing property. And there are salary caps on this. But 276 00:16:12,160 --> 00:16:14,160 Speaker 1: it's very interesting. It's never been tried here, It's been 277 00:16:14,200 --> 00:16:15,760 Speaker 1: tried in the UK. I've had to look at some 278 00:16:15,840 --> 00:16:18,080 Speaker 1: of the I looked at that house, the Lord's report 279 00:16:18,160 --> 00:16:22,200 Speaker 1: on the British one and the various observations they made, 280 00:16:22,240 --> 00:16:25,960 Speaker 1: which the big takeaway was that it worked in the regions. 281 00:16:25,960 --> 00:16:29,800 Speaker 1: It didn't work in the cities because the pass there's 282 00:16:29,840 --> 00:16:31,760 Speaker 1: so much lower in the regions in the UK. But 283 00:16:31,800 --> 00:16:32,920 Speaker 1: what do you think might happen here? 284 00:16:34,080 --> 00:16:37,480 Speaker 2: Well, Damsby might not have been tried at the federal 285 00:16:37,520 --> 00:16:40,080 Speaker 2: government level, but if ever been tried in Australia before 286 00:16:40,160 --> 00:16:43,920 Speaker 2: by certain private organizations. You may recall some years back 287 00:16:44,000 --> 00:16:47,480 Speaker 2: rizmarkat a ski and then I think there was another 288 00:16:47,520 --> 00:16:52,080 Speaker 2: one called Grainwaite Capital and quite frankly, these steams in 289 00:16:52,120 --> 00:16:55,600 Speaker 2: the past did not work. I predict that this one 290 00:16:55,600 --> 00:16:57,760 Speaker 2: will not really work either, and it will not be 291 00:16:57,880 --> 00:17:01,320 Speaker 2: the solution to a housing problems. But it look it 292 00:17:01,440 --> 00:17:05,399 Speaker 2: may work for some first time buyers who just simply 293 00:17:05,400 --> 00:17:08,359 Speaker 2: cannot get into the market at all. But I think 294 00:17:08,480 --> 00:17:12,159 Speaker 2: for the bulk of would be buyers, the thought of 295 00:17:12,240 --> 00:17:16,080 Speaker 2: the government having some ownership in your property, I think 296 00:17:16,119 --> 00:17:17,960 Speaker 2: that's a bit of a turnoff for many people. It 297 00:17:18,000 --> 00:17:19,920 Speaker 2: would be a turnoff for there. I wouldn't do it 298 00:17:20,000 --> 00:17:23,919 Speaker 2: unless I absolutely hate to. And just remember that in 299 00:17:23,960 --> 00:17:27,800 Speaker 2: all these things, when you have this shared equity, okay, 300 00:17:27,840 --> 00:17:29,560 Speaker 2: as sooner or later you have to pay the pie. 301 00:17:29,880 --> 00:17:31,760 Speaker 1: Is there some reason the government is a worse joint 302 00:17:31,840 --> 00:17:34,960 Speaker 1: ventship partner than ris Mark or whoever it was in 303 00:17:35,000 --> 00:17:35,479 Speaker 1: the past. 304 00:17:37,200 --> 00:17:39,639 Speaker 2: They might not be, They might not be as worse Jones. 305 00:17:39,680 --> 00:17:41,879 Speaker 2: And I think one thing that's improved over time is 306 00:17:41,920 --> 00:17:44,560 Speaker 2: that it's more or less being settled how things such 307 00:17:44,600 --> 00:17:47,840 Speaker 2: as repairs and maintenance need to be looked after. When 308 00:17:47,840 --> 00:17:51,240 Speaker 2: these initialis first came into the market some fifteen to 309 00:17:51,280 --> 00:17:53,960 Speaker 2: twenty years ago, no one ever really falls through the 310 00:17:54,000 --> 00:17:58,480 Speaker 2: issues surrounding repairs and maintenance. So I think a number 311 00:17:58,480 --> 00:18:01,360 Speaker 2: of those questions have been settled there after some experience. 312 00:18:02,720 --> 00:18:05,399 Speaker 2: But even so, I just don't think you're going to 313 00:18:05,400 --> 00:18:06,880 Speaker 2: say a lot of tie up in my year. 314 00:18:07,320 --> 00:18:09,399 Speaker 1: Oh right, okay, I must say I think they'll be 315 00:18:09,440 --> 00:18:11,840 Speaker 1: taken up. I reckon everything's spot will be taken up. 316 00:18:12,280 --> 00:18:15,960 Speaker 1: I do. Whatever the issues are. I think there's limited numbers. 317 00:18:16,000 --> 00:18:18,120 Speaker 2: I mean, let's say it's fully taken. Let's say you're right, 318 00:18:18,160 --> 00:18:20,480 Speaker 2: and now it's just actually going to resolve a out 319 00:18:20,560 --> 00:18:21,320 Speaker 2: housing issues. 320 00:18:22,440 --> 00:18:24,439 Speaker 1: No, I don't think so. But I'm just thinking of 321 00:18:24,480 --> 00:18:26,080 Speaker 1: it for the people who take it up that I 322 00:18:26,119 --> 00:18:28,359 Speaker 1: suppose it's an option that wasn't there previously. 323 00:18:28,680 --> 00:18:30,480 Speaker 2: I think that's a reasonable call. But I think in 324 00:18:30,480 --> 00:18:32,960 Speaker 2: the lull and they're going to resent having gotten a 325 00:18:33,000 --> 00:18:34,200 Speaker 2: nishick in their property. 326 00:18:35,000 --> 00:18:36,880 Speaker 1: It sounds to me like you're alluding to some sort 327 00:18:36,880 --> 00:18:41,640 Speaker 1: of Kafka esque bureaucratic nightmare that the young couple might 328 00:18:41,640 --> 00:18:42,280 Speaker 1: find themselves. 329 00:18:42,320 --> 00:18:45,359 Speaker 2: There is a libertarian part of me, and you know, 330 00:18:45,480 --> 00:18:47,800 Speaker 2: I just I think there will be down a lot 331 00:18:47,800 --> 00:18:49,120 Speaker 2: of people say no, thank you. 332 00:18:49,600 --> 00:18:52,600 Speaker 1: Okay, And I think that point of view is worth canvassing. 333 00:18:52,600 --> 00:18:54,320 Speaker 1: Folks are just having a look at I think one 334 00:18:54,320 --> 00:18:56,320 Speaker 1: of the I think, well, the defense properties for instance. 335 00:18:56,359 --> 00:18:59,399 Speaker 1: They are often seen as looking attractive, but you know 336 00:18:59,480 --> 00:19:02,080 Speaker 1: when you do go into those they are very strict 337 00:19:02,119 --> 00:19:06,080 Speaker 1: all their measures and regulations and maintenance demands. So they're 338 00:19:06,119 --> 00:19:09,280 Speaker 1: all pre ordered and pre agreed, and you are just 339 00:19:09,560 --> 00:19:11,840 Speaker 1: you know, you against the army or you against the 340 00:19:11,880 --> 00:19:14,280 Speaker 1: Australian government. Is something to consider. 341 00:19:14,680 --> 00:19:17,280 Speaker 2: They can their restrictions. And then I also bring to 342 00:19:17,320 --> 00:19:21,240 Speaker 2: your teaching quite separately, just so the issues surrounding Indis 343 00:19:21,320 --> 00:19:25,280 Speaker 2: properties of lake as well, which unfortunately you've had some 344 00:19:26,280 --> 00:19:27,840 Speaker 2: and all of saying this is what happened with the 345 00:19:27,880 --> 00:19:30,840 Speaker 2: shit equity back, we're saying situation where you've had some 346 00:19:31,160 --> 00:19:35,560 Speaker 2: odd scrupulous operators enter into that spoutace for ABIs properties 347 00:19:35,560 --> 00:19:39,000 Speaker 2: and a lot of innocently versus are being burnt. So 348 00:19:39,240 --> 00:19:42,359 Speaker 2: it's really important all these things or these skins, that 349 00:19:42,480 --> 00:19:44,880 Speaker 2: you look at the day job, whether you're a first 350 00:19:44,880 --> 00:19:48,160 Speaker 2: time by very investing, you really consider the day job. 351 00:19:48,600 --> 00:19:51,800 Speaker 1: That's important alls, and I think it's important to also 352 00:19:51,840 --> 00:19:54,840 Speaker 1: say to the listeners that the ndis stuff. A lot 353 00:19:54,880 --> 00:20:00,960 Speaker 1: of the developers after works for masquerading basic as the government, 354 00:20:01,000 --> 00:20:03,880 Speaker 1: which they weren't. They were simply building buildings that were 355 00:20:04,119 --> 00:20:08,480 Speaker 1: suitable for NDIS, but they weren't their government building the buildings, 356 00:20:08,760 --> 00:20:12,280 Speaker 1: while here you are actually participating directly with the feathering government. 357 00:20:12,320 --> 00:20:15,280 Speaker 1: This is on the home shared equity schemes. So all 358 00:20:15,359 --> 00:20:17,439 Speaker 1: to be revealed in the fullness of time. Okay, with 359 00:20:17,520 --> 00:20:31,680 Speaker 1: ex short break and we'll do some questions from listeners. Hello, 360 00:20:31,800 --> 00:20:34,640 Speaker 1: welcome back to The Australian's Money Puzzle. James Kirby here 361 00:20:34,640 --> 00:20:37,880 Speaker 1: with Louis Christopher of the s QM Research Group. That's 362 00:20:37,880 --> 00:20:40,280 Speaker 1: a property research group that I'm sure you're familiar with, 363 00:20:40,320 --> 00:20:45,120 Speaker 1: the Independent Property Research Group, who run a continuing sort 364 00:20:45,119 --> 00:20:48,200 Speaker 1: of flow of reports on the market which we report 365 00:20:48,240 --> 00:20:52,480 Speaker 1: on regularly in The Australian and elsewhere. Okay, Josh, Now 366 00:20:52,560 --> 00:20:55,399 Speaker 1: Josh puts in brackets. He's from Brisbane and you'll figure 367 00:20:55,400 --> 00:20:57,320 Speaker 1: out why in a second. When I read this question, 368 00:20:58,080 --> 00:21:00,920 Speaker 1: love your show, but I can't have think that as 369 00:21:00,960 --> 00:21:03,760 Speaker 1: you live in Melbourne, you can't see how bad the 370 00:21:03,840 --> 00:21:07,719 Speaker 1: perception of investing in any form of property in Victoria is. 371 00:21:08,440 --> 00:21:11,160 Speaker 1: All I see is an absolute basquet case of financially 372 00:21:11,200 --> 00:21:14,320 Speaker 1: irresponsible city that has been run into the ground with 373 00:21:14,520 --> 00:21:17,919 Speaker 1: mountains of debt. Yet not only do Victorians keep voting 374 00:21:17,920 --> 00:21:21,120 Speaker 1: these people into power, these policymakers into power, but they 375 00:21:21,880 --> 00:21:25,640 Speaker 1: build them statues. I find it mind boggling that any 376 00:21:25,720 --> 00:21:28,119 Speaker 1: sane person would invest in such a market at present 377 00:21:28,240 --> 00:21:31,399 Speaker 1: and can't help but think it has a long long 378 00:21:31,520 --> 00:21:35,200 Speaker 1: that's three long stare folks wait to go to rectify itself. Okay, Josh, 379 00:21:35,640 --> 00:21:38,560 Speaker 1: you know the rational part of me says, when someone 380 00:21:38,680 --> 00:21:41,800 Speaker 1: starts talking about that, about a city that's going to 381 00:21:41,800 --> 00:21:45,640 Speaker 1: be the biggest city in Australia, that has, whatever way 382 00:21:45,640 --> 00:21:50,919 Speaker 1: you look at it, terrific fundamentals, I would start looking 383 00:21:50,960 --> 00:21:54,800 Speaker 1: at it more as a long term opportunity. When the 384 00:21:54,840 --> 00:21:58,760 Speaker 1: current regime in Victoria is sparking such comment, I'm not 385 00:21:58,800 --> 00:22:01,439 Speaker 1: surprised that's sparking that kind of common but I wouldn't 386 00:22:01,480 --> 00:22:05,240 Speaker 1: right off the city of Melbourne. It's a property investment possibility. 387 00:22:05,240 --> 00:22:07,040 Speaker 1: And what about you, Louis. 388 00:22:07,160 --> 00:22:09,480 Speaker 2: Now, I'm instantainly not over the long turn, Jones. Well, 389 00:22:09,520 --> 00:22:12,040 Speaker 2: the governance come and go, as we all know. At 390 00:22:12,080 --> 00:22:14,120 Speaker 2: this appointing time, I would have to say to State 391 00:22:14,160 --> 00:22:17,040 Speaker 2: of Victoria, is not overly conduce you to property investment, 392 00:22:17,119 --> 00:22:20,000 Speaker 2: because among other things you've got to investor laying tax. 393 00:22:20,160 --> 00:22:23,040 Speaker 2: It's there in so callth it's going to introduce by Dounma. 394 00:22:23,640 --> 00:22:26,879 Speaker 2: But let's remember a few things here. Firstly, the state 395 00:22:26,880 --> 00:22:30,480 Speaker 2: of Victoria is still growing population wise. It's getting a 396 00:22:30,760 --> 00:22:35,480 Speaker 2: very strong share of overseas migration. So no matter what, 397 00:22:36,240 --> 00:22:38,600 Speaker 2: the state continues to grow with the population front, and 398 00:22:38,640 --> 00:22:41,320 Speaker 2: that means a hunderlying demand for real estate con two 399 00:22:41,359 --> 00:22:45,199 Speaker 2: years to increase. Let's also keep in mind that the 400 00:22:45,200 --> 00:22:49,320 Speaker 2: stud of Victory it is a diversified economy. It's got 401 00:22:49,320 --> 00:22:53,320 Speaker 2: a very large share of the financial services sector across Australia. 402 00:22:53,480 --> 00:22:57,200 Speaker 2: It also has a very good manufacturing sector as well. 403 00:22:57,760 --> 00:23:01,639 Speaker 2: It's what we call a very nicely diversified economy and 404 00:23:01,840 --> 00:23:05,360 Speaker 2: will remain that way, which is good for the long term. 405 00:23:06,080 --> 00:23:09,720 Speaker 2: Over the short term, look, yeah, there's been decisions made 406 00:23:09,760 --> 00:23:12,159 Speaker 2: by the Gunment which you know I don't necessarily agree with, 407 00:23:12,920 --> 00:23:15,160 Speaker 2: but like I said, over the long term, governments will 408 00:23:15,160 --> 00:23:17,399 Speaker 2: come and go and there will be a time again 409 00:23:18,040 --> 00:23:21,919 Speaker 2: when that the housing market will be running into positive territory. 410 00:23:22,359 --> 00:23:26,199 Speaker 2: The declines that's been recorded have been modesty clients so 411 00:23:26,320 --> 00:23:30,760 Speaker 2: far for this year, helping prove fundamental valuations. But as 412 00:23:30,800 --> 00:23:33,320 Speaker 2: said on our numbers, we still think the northern housing 413 00:23:33,400 --> 00:23:36,800 Speaker 2: market is somewhat over age, not as overvaid as where 414 00:23:36,880 --> 00:23:41,240 Speaker 2: city stands, but nevertheless somewhat overvaid coveted to rents and incomes. 415 00:23:41,800 --> 00:23:44,840 Speaker 2: But yeah, for a long time, a long term. If 416 00:23:44,840 --> 00:23:47,919 Speaker 2: you take a long term view on investing, then the 417 00:23:47,920 --> 00:23:50,120 Speaker 2: study of Victoria is definitely still worth a look. 418 00:23:50,760 --> 00:23:55,480 Speaker 1: Okay, interesting, and in your predictions it participates in that 419 00:23:55,960 --> 00:23:57,480 Speaker 1: v ship recovery media next. 420 00:23:57,400 --> 00:24:00,840 Speaker 2: Year it does so housing price falls in the first 421 00:24:00,840 --> 00:24:03,680 Speaker 2: half of the year, and then assuming we get that right, 422 00:24:03,760 --> 00:24:06,560 Speaker 2: cup Medie, we should start to see a return of 423 00:24:06,600 --> 00:24:09,000 Speaker 2: by competence in the second half of twenty twenty five. 424 00:24:09,359 --> 00:24:11,520 Speaker 2: Across Melbourne. I think the inner city area is given 425 00:24:11,600 --> 00:24:14,280 Speaker 2: how much stock we're saying there, I'm also sure whether 426 00:24:14,359 --> 00:24:16,560 Speaker 2: that will enjoy so much of the V shaped recovery. 427 00:24:16,560 --> 00:24:20,359 Speaker 2: But we're noticing more strengthently out of ring of Victoria, 428 00:24:20,480 --> 00:24:25,320 Speaker 2: so less softness in North Melbourne in the Mornington Penicula 429 00:24:25,600 --> 00:24:28,719 Speaker 2: area there we're still seeing plenty of bars there to 430 00:24:28,720 --> 00:24:31,919 Speaker 2: an extent. The bulk of a softness in Melbourne is 431 00:24:31,920 --> 00:24:33,360 Speaker 2: in the inner city areas. 432 00:24:33,119 --> 00:24:36,600 Speaker 1: Right now, Okay, okay, interesting, all right, fine? Question from 433 00:24:36,640 --> 00:24:39,720 Speaker 1: Lisa A. Lisa can I ask you and your guest. 434 00:24:39,840 --> 00:24:42,680 Speaker 1: My son and his girlfriend are interested in buying a 435 00:24:42,880 --> 00:24:46,080 Speaker 1: one bedroom apartment. I don't know what city this is. 436 00:24:46,440 --> 00:24:48,480 Speaker 1: I know it is seen as a foot on the 437 00:24:48,480 --> 00:24:51,600 Speaker 1: property ladder, but everything I have ever read suggests they 438 00:24:51,840 --> 00:24:57,080 Speaker 1: in one bedroom apartments are relatively hopeless investments discuss. 439 00:24:57,520 --> 00:25:01,320 Speaker 2: Okay, so they're solely a lot more risk buying an 440 00:25:01,320 --> 00:25:05,240 Speaker 2: off the plan one bedroom apartment. But a few words 441 00:25:05,280 --> 00:25:09,320 Speaker 2: of buy established one bedroom, a part of it that 442 00:25:09,440 --> 00:25:14,280 Speaker 2: says reasonably modern, even an older style one, then a 443 00:25:14,400 --> 00:25:19,120 Speaker 2: lot of the depreciation affected depreciations already heard on that property. 444 00:25:19,840 --> 00:25:21,680 Speaker 2: So when you're buying a new property, it's not buying 445 00:25:21,680 --> 00:25:25,280 Speaker 2: a new car. You're buying a cent off the showroom floor. 446 00:25:25,600 --> 00:25:28,879 Speaker 2: You're paying a premium for its units. But there's a 447 00:25:28,920 --> 00:25:32,159 Speaker 2: good reason why the ATO gives you a depreciation allowing 448 00:25:32,200 --> 00:25:35,400 Speaker 2: some new properties, because they depreciate. All those pictures there, 449 00:25:35,400 --> 00:25:38,480 Speaker 2: fittings depreciate. They will not look as good as they 450 00:25:38,520 --> 00:25:41,560 Speaker 2: are now in ten years time. But once that's taking 451 00:25:41,560 --> 00:25:44,440 Speaker 2: into account into the price, which happens when you buy 452 00:25:44,480 --> 00:25:47,240 Speaker 2: an established property that's say, for example, five years or 453 00:25:47,560 --> 00:25:50,760 Speaker 2: we're older, you will find such properties will perform at 454 00:25:50,840 --> 00:25:54,440 Speaker 2: least in line with market. Now. Of course, you still 455 00:25:54,480 --> 00:25:56,879 Speaker 2: need to do your research on, say, out the Palmer block, 456 00:25:57,280 --> 00:25:59,960 Speaker 2: because what you don't want to see a major fold 457 00:26:00,000 --> 00:26:05,240 Speaker 2: it's another part of block. Otherwise, even buying in existing 458 00:26:05,320 --> 00:26:09,200 Speaker 2: property inside the faulty block, you're up for problems going forward. 459 00:26:09,600 --> 00:26:11,280 Speaker 2: You've got to be careful that. And that's why I 460 00:26:11,320 --> 00:26:13,840 Speaker 2: always say that people read the Strata minutes, get your 461 00:26:13,840 --> 00:26:17,040 Speaker 2: hands on the committee minutes, to see what's been going 462 00:26:17,119 --> 00:26:19,400 Speaker 2: on behind the scenes at a public block. 463 00:26:20,119 --> 00:26:22,640 Speaker 1: And see what's what may be coming down the line. 464 00:26:22,920 --> 00:26:24,119 Speaker 2: Absolutely, I might. 465 00:26:23,960 --> 00:26:26,320 Speaker 1: Be waiting for you to buy your apartment to it. 466 00:26:27,040 --> 00:26:29,320 Speaker 2: But d and all this what we've been finding of 467 00:26:29,440 --> 00:26:32,560 Speaker 2: lead in more recent cycles is that units are being 468 00:26:32,680 --> 00:26:37,000 Speaker 2: reasonably a good defensive playing market downturns. They up toform 469 00:26:37,080 --> 00:26:41,120 Speaker 2: houses and market downturns, they turned up under perform houses 470 00:26:41,119 --> 00:26:42,000 Speaker 2: and upturns. 471 00:26:42,280 --> 00:26:45,480 Speaker 1: Okay, So which would imply that they will do better 472 00:26:45,600 --> 00:26:48,560 Speaker 1: than the rest of the market in this immediate period 473 00:26:48,600 --> 00:26:49,640 Speaker 1: of softness. 474 00:26:49,640 --> 00:26:51,840 Speaker 2: Correct, Yeah, very. 475 00:26:51,640 --> 00:26:54,920 Speaker 1: Interesting, Okay, terrific, Hey, terrific to get you Louis again, 476 00:26:55,040 --> 00:26:57,119 Speaker 1: great to have you on the show. As usual, always 477 00:26:57,280 --> 00:27:00,640 Speaker 1: very very good helicopter view of the market. Very practical 478 00:27:00,640 --> 00:27:03,280 Speaker 1: one too. Thanks at Louis Christopher of Escue and Research, 479 00:27:03,480 --> 00:27:06,760 Speaker 1: do send us some correspondence. Folks love to have some 480 00:27:06,800 --> 00:27:12,240 Speaker 1: more questions or even observations like Joshua's quite distinct observation 481 00:27:12,320 --> 00:27:14,879 Speaker 1: there on the Melbourne market from the distance of Brisbane. 482 00:27:15,480 --> 00:27:17,879 Speaker 1: Whatever you like, love to hear from you the Money 483 00:27:17,880 --> 00:27:21,760 Speaker 1: Puzzle at the Australian dot com dot Au. Today's show 484 00:27:21,800 --> 00:27:24,560 Speaker 1: was produced by Leah Samuel Glue. Talk to you soon.