Speaker 1: Hello and welcome to the Australians Money Puzzle podcast. I'm
Speaker 1: James Kirby. Welcome aboard everybody. Now, so far this year
Speaker 1: has been all about the share markets, which really have
Speaker 1: been running hot for some time, and property really having
Speaker 1: something of a soft period, certainly in the first few
Speaker 1: months of the calendar year twenty twenty five. But in
Speaker 1: recent weeks we are seeing signs that the Australian property
Speaker 1: market may be ready to rebound, especially in the larger cities.
Speaker 1: My guest today is Louis Christopher of the SQM Research Group,
Speaker 1: and he is on the record saying the horse is
Speaker 1: about to bolt. The horse is about to bolt. Discuss
Speaker 1: how are you, Louis, Yeah, nice to.
Speaker 2: Be with you once again, James and your audience. Yes,
Speaker 2: I did starke that over the weakend imagine media mast head.
Speaker 2: And the reason why I stated is because it's becoming
Speaker 2: quite apparent now that auction clearance rates are firming in
Speaker 2: Sydney and Melbourne. At least they've been firming really since
Speaker 2: the month of May, and I believe they will continue
Speaker 2: to firm as we get into the second half of
Speaker 2: twenty twenty five.
Speaker 1: Now, just tell our listeners what those rates, those auction
Speaker 1: clearance rates being the percentage that are sold on the
Speaker 1: weekend when they go up for sale, Like what's healthy?
Speaker 1: Where are they at? What's healthy and where have they been.
Speaker 2: Well well, James, There's different methodologies out there. There's a
Speaker 2: number of providers that provide including s Q and Research,
Speaker 2: and we generally have a more conservative methodology employed for
Speaker 2: these auction clearance rates. But in a nutshell, it's meant
Speaker 2: to represent the proportion of properties which are sold versus
Speaker 2: the number of properties scheduled for auction for the PEERI concern.
Speaker 2: Usually the monitoring period is for the past week through
Speaker 2: to the weekend, and preliminary measurements of clearance rates for
Speaker 2: the past weeks through the last weekend suggests the clearance
Speaker 2: rates were hovering in the sixty to seventy percent our
Speaker 2: mark for Sydney and Melbourne. Now our more conservative measure
Speaker 2: has clearence rates hovering now just by in the fifty
Speaker 2: percent range. And historically when we've seen clearance rates on
Speaker 2: our measurements hit fifty percent and rising, it's generally meant
Speaker 2: that the housing market is starting to show acceleration. In
Speaker 2: other words, housing prices are rising.
Speaker 1: Okay, so, so you've seen the signs of improved temple
Speaker 1: and just as supposed to put it into context, the
Speaker 1: Cautality groups long time core logic, they say that national
Speaker 1: hall prices are of five point eight percent year to deed,
Speaker 1: that's not bad, just above the long term average. So
Speaker 1: looking at it a bit more closely, Louis, I assume
Speaker 1: what's really changing is that Sydney and Melbourne are coming
Speaker 1: to the party.
Speaker 2: That is correct, James, Yes, I believe housing prices are
Speaker 2: now rising again in Sydney and Melbourne. They have been
Speaker 2: rising essentially since the start of the year, but I
Speaker 2: think the rate of growth has started to accelerate, particularly
Speaker 2: since the last rate cut.
Speaker 1: Okay, so if we've got average or so so far
Speaker 1: this year, and we know that the big cities were
Speaker 1: soft for some time, I mean, could we actually have
Speaker 1: a better than average year across property prices residential prices nationwide?
Speaker 2: Our forecast for calendar year twenty twenty five is that
Speaker 2: capital city housing prices will rise somewhere between six to
Speaker 2: ten percent. We had that forecast out from the start
Speaker 2: of the year and we're feeling more and more confident
Speaker 2: at that. Our forecast is actually going to come in.
Speaker 1: So this swing factor is interest rates? Is it really
Speaker 1: is that this outstanding issue that's changed.
Speaker 2: It's a combination of two factors in our view, James, Yes,
Speaker 2: interest rates definitely having an impact upon borrowing power and
Speaker 2: purchasing power, especially for first home buyers. Second, too, that
Speaker 2: we're still recording very strong population growth rates, so underlying
Speaker 2: demand for accommodation across the country continues to increase, and
Speaker 2: that's up against real constraints on the supply side. So
Speaker 2: for this calendar year, we're likely to only build somewhere
Speaker 2: around one hundred and fifty thousand new dwellings for the
Speaker 2: calendar year, that's the likely number. But the population is
Speaker 2: likely to expand by probably just under five hundred thousand
Speaker 2: people for the calendar year. And clearly those two don't match.
Speaker 1: Well, they don't match well. Yeah, I see. The other
Speaker 1: thing that struck me that the question over the whole
Speaker 1: thing was that properly stock at auction is at a
Speaker 1: five year low. So we are at that point perhaps
Speaker 1: where the market is getting better. Most people don't realize
Speaker 1: it yet when they do realize that the property stock
Speaker 1: will flood in.
Speaker 2: Look, I think on our numbers, James, we're actually recording
Speaker 2: better listing counts than that, especially for Sydney and Melbourne,
Speaker 2: so we're not recording record lows and listings for Sydney Melbourne.
Speaker 2: We have been recording record lows for listings in Perth
Speaker 2: and in Adelaide, but for Sydney Melbourne we're actually back
Speaker 2: to more normal long term averages after a period of
Speaker 2: being at near record lows.
Speaker 1: Okay, so that is what you would expect with the
Speaker 1: market starting to improve that people would also what I'm
Speaker 1: really driving at, is there any risk of overhang that
Speaker 1: there will be properly stock will come on and soften
Speaker 1: these numbers.
Speaker 2: Not likely, James, As mentioned before, where we've been suffering
Speaker 2: a multi year supply constraint which has been driven by
Speaker 2: a host of factors. And when I look at the
Speaker 2: building approval numbers, which is a leading indicator of new activity,
Speaker 2: there's been a little bit of a pickup, but it's
Speaker 2: not enough to suggest we're going to have an oversupply
Speaker 2: situation in the housing market. Now, We've still got an
Speaker 2: undersupply situation in housing market. One great example of that's
Speaker 2: what's been happening in the rental market. We as a
Speaker 2: research house, are still recording rental vacancy rates under two
Speaker 2: percent for most of the nation, and that is a
Speaker 2: signal that basically the rental market, he's still favoring landlords
Speaker 2: over tenants, and it's obviously suggestive of a market which
Speaker 2: is in shortage.
Speaker 1: So Louis I mean the thing about for investors, the
Speaker 1: yields have been improving post covered those years. They're improved
Speaker 1: for the first time in a long time. What's the
Speaker 1: picture now for investors in terms of rented yields.
Speaker 2: Yes, rental yields increased over the period twenty twenty two
Speaker 2: through to about twenty twenty four inclusive. And the primary
Speaker 2: reason why we had an increase in rental yields was
Speaker 2: the rise in interest rates per se, So investors were
Speaker 2: demanding a higher return for their properties to compensate themselves
Speaker 2: for the higher interest rate environment. And how they were
Speaker 2: demanding that was effectively they were less in the market.
Speaker 2: So rental a rising while housing prices weren't doing that
Speaker 2: much at all, and that pushes up rental yields. Now,
Speaker 2: of late, we've seen the stabilization and rental yields for
Speaker 2: most parts of the country where housing prices are rising
Speaker 2: at the same rate that rents are, and that has
Speaker 2: meant a stabilization of rental yields. What this has meant
Speaker 2: over all, though, is yes, rental yields are stabilized, but
Speaker 2: there's still above long term averages and so there is
Speaker 2: a bit of an enticement. Now we're getting interest right
Speaker 2: cuts for investors the take advantage of these above long
Speaker 2: term average rental yields and coming to the marketplace.
Speaker 1: Yeah, so in many ways it sounds like it sounds
Speaker 1: like pretty good conditions for the confident investor. That you've
Speaker 1: got riates on coming down, you've got stable rental use,
Speaker 1: you've got stable price growth both running more or less
Speaker 1: long term averager even better. But of course the tempo
Speaker 1: is approved, as you say, as you mentioned at the start,
Speaker 1: the clearance rates kind of prove that. All right, we'll
Speaker 1: take a show break and we will come back and
Speaker 1: look at it from the investor point of view, and
Speaker 1: we look at it in terms of where the action
Speaker 1: may be, and we'll also cover the issue of apartment losses,
Speaker 1: which have been a big issue on the show in
Speaker 1: recent times. Back in the moment, one of the things,
Speaker 1: louis when we were talking in the first segment. It
Speaker 1: does sound good, but on closer inspections this market's quite
Speaker 1: patchy still. You've had strong markets in Brisbane, Perth Athlete
Speaker 1: soft market, Sydney and Melbourne. You've had very good numbers
Speaker 1: on houses standardone houses, but some very soft markets in
Speaker 1: apartments in the big cities, particularly Melbourne. What's the outlook
Speaker 1: do you think for that picture? Do we get a
Speaker 1: continuation of that?
Speaker 2: Yes, Melbourne's been a very interesting market on the apartment side.
Speaker 2: So we've definitely seen underperformance on apartment prices for the
Speaker 2: last four to five years now in Melbourne. And I've
Speaker 2: noted there's been a number of groups of contact our office,
Speaker 2: for example, who think it's a great time to maybe
Speaker 2: buy it because rental yields are higher in Melbourne. But
Speaker 2: I think we need to consider, well, why have Melbourne
Speaker 2: units been underperforming to begin with? What has actually driven that?
Speaker 2: And to an extent, Melbourne's actually had some success increasing
Speaker 2: the supply side of high density apartments over the last
Speaker 2: three years, much better than say what's been happening on
Speaker 2: the supply side in Sydney and in Brisbane and Adelaide
Speaker 2: and pur Melbourne's had some success in getting some more
Speaker 2: dwellings built now that might be one of the reasons
Speaker 2: for it, and so on the flip side. That's a
Speaker 2: positive thing for rent it's no question about that. But
Speaker 2: it has been so great for investors. Will this continue
Speaker 2: going forward in tones of relatively good supply in the
Speaker 2: Melbourne market, I'm not so sure. I'm not so sure.
Speaker 2: And I note that the rental yields were recording in
Speaker 2: the Melbourne UNI market are the heis they've ever been
Speaker 2: since we started records in two thousand and nine. So
Speaker 2: when you look at the straight out fundamentals in terms
Speaker 2: of the data the rental yields, it's suggesting that Melbourne
Speaker 2: units could be a goodbye right now. I'm unsure where
Speaker 2: it is. I'm not putting my hat on to say
Speaker 2: you must buy where you should buy Melbourne units right now.
Speaker 2: I think there's still challenges with the state economy, with
Speaker 2: local councils in Melbourne, and with the state government in
Speaker 2: terms of taxation surrounding property investing. But nevertheless, the facts
Speaker 2: are the facts. If you were to buy in Melbourne now,
Speaker 2: you'll be getting in the historically high yield.
Speaker 1: What are those years compared to what a person might expect.
Speaker 1: I'm assuming they used to be two and three percent.
Speaker 1: What are they now?
Speaker 2: Yes, Melbourne units, the average gross rental yield as a
Speaker 2: July twenty twenty five was four point eight percent. Now
Speaker 2: the long term marriage we've got it is about four
Speaker 2: point two percent, so we're about six hundred bases points
Speaker 2: above the long term average.
Speaker 1: Do they like years for country towns? Aren't they accepted
Speaker 1: to city of five million? I mean, from a face
Speaker 1: value would seem to be a really good investment scenario.
Speaker 1: But you did mention concerns, particularly around state taxes.
Speaker 2: Yeah, that's right, I mean things you know. I think
Speaker 2: I'm a strong believer that the housing markets across not
Speaker 2: just Australia, but across the world that develops world, have
Speaker 2: become increasingly efficient. In other words, the markets quickly pricing
Speaker 2: what is known in the marketplace, all the pros and
Speaker 2: cons to invest in. And yes, as mentioned, I think
Speaker 2: these elevated yields in Melbourne units have occurred because we've
Speaker 2: seen a better supply response and we've also seen a
Speaker 2: situation where investors have been a little bit more cautious
Speaker 2: about buying into the Victorian state economy.
Speaker 1: Yeah, yeah, I wonder is that. So I suppose the
Speaker 1: Bellion dollar question is whether it's structural, whether the moment
Speaker 1: becomes this city where there's got good years and poor
Speaker 1: growth because of the supply.
Speaker 2: Potentially it could that's definitely factor in all less we
Speaker 2: must we must note population growth still running strong, and
Speaker 2: it's still running strong for the state of Victoria. So
Speaker 2: absorption rates for new stock are relatively high in Victoria,
Speaker 2: and so there is the possibility, and probably it's more
Speaker 2: than the possibility that we will actually see rental yields
Speaker 2: fall from here, especially with the rate cuts, and so
Speaker 2: that would mean prices would be rising for Melbourne units.
Speaker 2: And I think we will see price rises for Melbourne
Speaker 2: units in the second half of this year.
Speaker 1: Okay, that's really interesting. So in terms of bargain hunting,
Speaker 1: it would seem to be the place to do so,
Speaker 1: but you're still skeptical. It's interest if you have people
Speaker 1: on the show who openly say this is a bargain.
Speaker 1: This is a city of five million people.
Speaker 2: Probably fair to say, James, we're cautious. But I think overall,
Speaker 2: for the overall housing market for our largest cities, we're
Speaker 2: becoming more and more bullish given the rate cuts, given
Speaker 2: what we're seeing in auction clearance rates overall.
Speaker 1: Okay, well, what I have you want? It's your if
Speaker 1: you could. If I said to you, I want you
Speaker 1: to buy an investment property and if you like, and
Speaker 1: you have to do it in the next month, I
Speaker 1: want you to think in terms of regions, where would
Speaker 1: you be looking.
Speaker 2: Ah, I've been stating for a number of years now,
Speaker 2: ever since the announcement of the twenty thirty two Winter
Speaker 2: Olympics that we have that I have a view that
Speaker 2: Brisbane's likely to outperform other capital cities over that period
Speaker 2: through to the opening of the Olympics. And I retain
Speaker 2: that few that doesn't mean it's going to outperform in
Speaker 2: all periods, but for the entire period it is likely
Speaker 2: to outperform. And I think for this year Brisbane's likely
Speaker 2: to record perhaps slower capital growth or capital growth that's
Speaker 2: in line with Sydney and Melbourne, but the expectation is
Speaker 2: still there. Brisbane is going to outperform through to the
Speaker 2: twenty thirty two Winter Olympics. And the reason why I
Speaker 2: say that it's not so much the infrastructure that's going
Speaker 2: into the winter Olympics, so not the Winter Olympics, the
Speaker 2: Summer Olympics. It's the strong overall population, right, You wouldn't
Speaker 2: want to do Winter Olympics in prison, that's sure.
Speaker 1: You're ord enough to remember the run up to the
Speaker 1: Cydny Olympics, I imagine, and the extraordinary property market in Sydney.
Speaker 2: Well, that's right, and that run up to the summer
Speaker 2: the two thousand Summer Olympics, between essentially nineteen ninety three
Speaker 2: to the two thousand city did actually outperform most other
Speaker 2: capital cities over that time.
Speaker 1: Yes, yes it did, and I suppose to be fair
Speaker 1: to everyone listening, it's also worth having a look what
Speaker 1: happened after two thousand where Sydney underperformed for a while
Speaker 1: because you had that amazing pull forward. But from an
Speaker 1: investment point of view, there's plenty of time in it. Okay,
Speaker 1: really interesting answer, Louie, Thank you very much. We have
Speaker 1: some really good questions and they're actually quite focused on
Speaker 1: property and property investments, so we will be back in
Speaker 1: a minute. Hello, Welcome back to the Australian's Money Puzzle podcast,
Speaker 1: James Covey with Louis Christopher from SQM Research. Louis one
Speaker 1: of the voices independent voices on the property market. And
Speaker 1: that's why I love having him on the show, because
Speaker 1: he's not selling, he is examining, and that gives us
Speaker 1: a great sort of independent view on helicopter view of
Speaker 1: the market. Nathan says on the performance of apartments, in
Speaker 1: line with the wider discussion you raised around tax reform,
Speaker 1: do you think the treasure may consider tax incentives for
Speaker 1: people to buy apartments as opposed to houses as one
Speaker 1: measure to combat the housing crisis. That's a really interesting idea.
Speaker 1: There is no rules on all these grants, on all
Speaker 1: these incentives stretching from first home super saver, first home
Speaker 1: buyer guarantee, shared equity. They don't ever frenzy between the two.
Speaker 1: Do they do it as I'm as I know they don't.
Speaker 2: No, they don't. And James, I have a personal fundamental
Speaker 2: issue with taxes, which I think are to property taxes
Speaker 2: which I think are too high to begin with and
Speaker 2: discourage new property development. Being overlaid with subsidies sounds awfully
Speaker 2: inefficient to meet, James.
Speaker 1: Right, you're saying, yeah, yeah, you've got high taxes and
Speaker 1: then you put in lots of incentives, which is.
Speaker 2: Like, yeah, that's exactly right. When you see a new
Speaker 2: dwelling out there, whether it be a new home or
Speaker 2: a new apartment, you can assume, depending on the state,
Speaker 2: that thirty to forty percent of the cost of that
Speaker 2: new dwelling is being driven by taxes. It's all. It's
Speaker 2: you know, thirty to forty percent of the cost of
Speaker 2: that dwelling is taxes. Why is it so high? And
Speaker 2: I'm talking about a combination of local taxes, state taxes,
Speaker 2: federal taxes. That's what that's basically what's baked into the
Speaker 2: cost of every new home you see, and it just
Speaker 2: seems to be way too high to meet.
Speaker 1: A stamp duty the outstanding tax.
Speaker 2: Stamp duty yep, stamp duty would be one as you know,
Speaker 2: like rates as well, the cost of you know, local
Speaker 2: council approving a development and everything that they want in
Speaker 2: return to get a development up. On average, you know,
Speaker 2: thirty to forty percent of the cost of a new
Speaker 2: dwelling has been driven by taxes. And that's what in
Speaker 2: my view, we've got to try and aim for over
Speaker 2: the long term, real taxation reform so we can get
Speaker 2: those costs down. And if we were to do that,
Speaker 2: I think we would see an increase in supply from developers. Now,
Speaker 2: there's a few other things we need to do, and
Speaker 2: I think when it comes to builders and developers, you've
Speaker 2: got to have a bit of a carrot and a
Speaker 2: stick approach towards that industry. The stick being it, if
Speaker 2: they do not build quality buildings, they really need to
Speaker 2: be punished. But the carrot also being that, Okay, if
Speaker 2: I can build quality, let's get that bride given point
Speaker 2: down and that should increase the supply side for the country.
Speaker 1: Okay, Well, yes, no sign of any of that coming through.
Speaker 1: There is a big tax, big tax get together later
Speaker 1: in the year, which everyone has high hopes for. I
Speaker 1: don't know certainly from what the attempts so far in
Speaker 1: the top property area for both federal labor and in
Speaker 1: the States, I wouldn't be holding my bread.
Speaker 2: I would to day the jains. I'm merely studying what
Speaker 2: should happen, But what will happen will either not a factor?
Speaker 1: Yes, all right, Bruce and Paul say on realized gains,
Speaker 1: Bruce says, I strongly disagree with both the taxing of
Speaker 1: unrealized gains and not indexing this new supertax. However, some
Speaker 1: people have raised the issue of council rates as an
Speaker 1: example of present day taxing of unrealized gains. You were
Speaker 1: not impressed with this in comparison. Could you please elaborate
Speaker 1: what was your main objection? Okay, So the predominant narrative
Speaker 1: right on the supertax is that it's never been done
Speaker 1: with for unrealized gains in such a fashion core to
Speaker 1: the taxing. Putting it into the tax system is not
Speaker 1: a good thing, and if it unworsted, it might expand
Speaker 1: if you like. And then people say, well, you know,
Speaker 1: on property, you've got unrealized gain taxes, you've got counseled rich,
Speaker 1: you've got land tax I would just say, yes, you do.
Speaker 1: But they are very much based on intrinsic value of property,
Speaker 1: which is where the valuation has lifted from A to B.
Speaker 1: The property is standing there, it's bricks and mortar. It's
Speaker 1: pretty reliable. In the new supertax, a person could buy bitcoin,
Speaker 1: they could buy a gold miner, they could buy a
Speaker 1: startup that the price of that could quadruple. They would
Speaker 1: be hit with a tax bill for that quadrupling in
Speaker 1: entirely theoretical paper gains. The following year the thing falls
Speaker 1: by fifty percent, and you see the problems. It's very illogical,
Speaker 1: inefficient to put mildly tax. It's going on unrealized gains,
Speaker 1: and all sorts of unexpected and unintended consequences will occur.
Speaker 1: We're already seeing them in this super tax. It's hitting
Speaker 1: people are starting to realize. It'll hit frank dividends, it'll
Speaker 1: hit narratives and super it'll hit private pension payments. Because
Speaker 1: it's unrealized gains, it's a very broad, crude measure of
Speaker 1: how people's finances are changing. Do you think Louis.
Speaker 2: James couldn't have said it better myself? Look, I think
Speaker 2: when it comes to the new super tax proposal, I've
Speaker 2: generally taken a view that look, it's understandable why the
Speaker 2: rate would be increased to thirty percent for those who
Speaker 2: are sitting on over three million dollars. I've had three
Speaker 2: issues with it. The issue, as you've rightly pointed out,
Speaker 2: the paper games, which I think will be very inefficient.
Speaker 2: And then the other issue I have, which has been
Speaker 2: raised more and more in the media, is the fact
Speaker 2: that the three million dollars is not going to be indexed,
Speaker 2: not initially anyway, And so that means that over the
Speaker 2: long term, assuming that three mens dolls is not adjusted,
Speaker 2: you will see the average income earn or the average
Speaker 2: supervaluation balance being impacted by this additional tax.
Speaker 1: Will it keep the serf managed super funds away from
Speaker 1: property investment?
Speaker 2: Yeah, it could, It could absolutely.
Speaker 1: Because it's so liquid. It's kind of a sitting dock
Speaker 1: for on realized gains tax, isn't it.
Speaker 2: It is it is now that said though, look, it's
Speaker 2: pretty easy to get evaluation these days on a residential
Speaker 2: property in particular, so and those valuations are reasonably reliable
Speaker 2: and they generally tend to be fairly stable, So you know,
Speaker 2: that's probably one thing in a positive and you know,
Speaker 2: I take your take on board what you said that
Speaker 2: your comment surrounding, for example, be coin and things which
Speaker 2: are more volatile, and I agree with you one hundred percent.
Speaker 1: It's interesting that property people are being relatively quiet in
Speaker 1: relation to this super tax.
Speaker 2: So far.
Speaker 1: Most of the complaints and protests are from for fairly
Speaker 1: obvious corners, if one managers Jeff Wilson, a self managed
Speaker 1: super funds association peter Burg as people like that very
Speaker 1: much out on front. But the property. The property sector
Speaker 1: has been fairly quiet about it. But I would have
Speaker 1: thought that if this gets in and as you say,
Speaker 1: it's not indexed, and everyone's calling for it to be indexed,
Speaker 1: I mean, the ACTU is calling for it to be indexed,
Speaker 1: but the government seem to be set in their ways
Speaker 1: that they won't index it, then mathematically more people will
Speaker 1: be caught very quickly. And in property terms, three million
Speaker 1: is not a gigantic number anymore.
Speaker 2: No, that's exactly. Three million dollars is not a gigantic number.
Speaker 2: But the proportion of self managed super fund investors who
Speaker 2: are invested in properly compared to all buys and all
Speaker 2: line owners is actually quite small relative to say your
Speaker 2: suburban advisor or fund manager, where you know a lot
Speaker 2: of their fund is made up of a superannuation investors.
Speaker 1: Yes, well, of course, call a chicken and egg there.
Speaker 1: I mean, the super funds would be much more keen
Speaker 1: on property if there was a bit of if there
Speaker 1: was a bit of a market, and if the banks
Speaker 1: would offer some loans. At the moment they have to
Speaker 1: pay the highest loans in the market, the highest lending
Speaker 1: rates in the market, and there's a constant threat over
Speaker 1: the whole area of borrowing for property in Super, and
Speaker 1: it never goes away. It comes and goes and people,
Speaker 1: you know, every year it's sort of under threat. So
Speaker 1: you've got the fact that it may not be allowed forever.
Speaker 1: You've got the fact that there isn't much of a market,
Speaker 1: so you've got to pay top donor for borrowing inside Super,
Speaker 1: and your negative gearing isn't as good. So I suppose
Speaker 1: in a way there's a sort of explanation why super
Speaker 1: self managed Super isn't as big in property as we
Speaker 1: might reasonably expect. We'll see. I wonder got feeling I
Speaker 1: think they'll indexes as a sort of a as a
Speaker 1: sort of a sp basically to increasingly loud protests. But
Speaker 1: then they'll push ahead on on realliance. What do you think.
Speaker 2: I think there'll be a compromise some way, James, and
Speaker 2: the compromise, the logical compromise would be indexation with three
Speaker 2: other things free.
Speaker 1: Right. But we'll see. If someone said to me the
Speaker 1: other day, everything gets indexed in the end, and I said, no,
Speaker 1: it doesn't actually not. So there's a division. Two ninety
Speaker 1: three super Text, the high income Supertext. It started with
Speaker 1: no indexing and it's running for twelve years. It's ever
Speaker 1: been indexed, so don't assume that this will happen. We'll see. Hey, Louie,
Speaker 1: thank you very much for being on the show. Terrific
Speaker 1: to have you, Great to get that helicopter view on
Speaker 1: the investment property market.
Speaker 2: Great to be with you and your audience once again, James, terrific.
Speaker 1: That was Louis Christopher of the SQM group. And let's
Speaker 1: see if Louie's got it right and the market is turning,
Speaker 1: we will be keeping a very close eye on it
Speaker 1: the weeks ahead. Let's have some more correspondence the Money
Speaker 1: Puzzle at the Australian dot com dot au. Talk to
Speaker 1: you soon.