Moody's last night downgraded the AA1 rating of Australia's big four banks to AA2, "relecting our view of the Australian banking system's structural sensitivity to conditions in wholesaly funding markets," according to Moody's senior vice-president Patrick Winsbury.
Australian banks are amongst the biggest users of wholesale funding, meaning they borrow huge amounts of money from abroad to make up the shortfall between what Australians deposit and what they want to borrow.
The subdued outlook for credit has reduced their funding needs, and the banks are taking steps to reduce reliance on wholesale funding.
Thursday, May 19, 2011
Wednesday, May 18, 2011
Government Population Strategy
The development group Urban Taskforce’s chief executive, Aaron Gadiel, says the Federal Government's sustainable population strategy released last Friday "avoids imposing any damaging population caps on the nation or on the major cities. We're pleased that the Federal Government has walked away from the notion that some parts of Australia are at carrying capacity".
However this seems rather to distort what the strategy actually says. The Federal Government focuses on boosting growth in regional areas and away from the outer suburbs of capital cities.
The report - Sustainable Australia, Sustainable Communities - does not set a population target, saying adopting one would limit the Government's ability to use the migration program to deal with skills gaps and labour shortages. However Population Minister Tony Burke says the strategy's focus is on where people live rather than setting an arbitrary figure for the size of the population.
Mr Burke says there are natural caps on growth such as the infrastructure and water-supply limits.
"There are natural limits to growth in Australia - it will never be a case of free-for-all," he said.
The report says a balance must be struck between the principles of economic sustainability, making communities livable and environmental sustainability.
Mr Burke says the Government is aiming to encourage business hubs in the outer suburbs and regional areas so people can find employment closer to home.
However this seems rather to distort what the strategy actually says. The Federal Government focuses on boosting growth in regional areas and away from the outer suburbs of capital cities.
The report - Sustainable Australia, Sustainable Communities - does not set a population target, saying adopting one would limit the Government's ability to use the migration program to deal with skills gaps and labour shortages. However Population Minister Tony Burke says the strategy's focus is on where people live rather than setting an arbitrary figure for the size of the population.
Mr Burke says there are natural caps on growth such as the infrastructure and water-supply limits.
"There are natural limits to growth in Australia - it will never be a case of free-for-all," he said.
The report says a balance must be struck between the principles of economic sustainability, making communities livable and environmental sustainability.
Mr Burke says the Government is aiming to encourage business hubs in the outer suburbs and regional areas so people can find employment closer to home.
House Prices "will be flat for ten years".
According to Jessica Darnbrough in the latest Real Estate Business magazine:
"Property price growth will be subdued for the next 10 years," an industry commentator has claimed. Speaking to Real Estate Business, BIS Shrapnel’s managing director Robert Mellor said property prices will grow by no more than 5 per cent each year.
“These are not boom conditions,” he said. “People have to get used to the fact that over the next 5 to 10 years, strong growth will be in the order of five per cent, while weaker years will see just 2 to 3 per cent growth.”
Mr Mellor said Australia is unlikely to see the rapid growth of previous years again anytime soon. “That growth was stimulated by various incentives, and as we are unlikely to see incentives return, we won’t see extraordinary growth return either."
"Property price growth will be subdued for the next 10 years," an industry commentator has claimed. Speaking to Real Estate Business, BIS Shrapnel’s managing director Robert Mellor said property prices will grow by no more than 5 per cent each year.
“These are not boom conditions,” he said. “People have to get used to the fact that over the next 5 to 10 years, strong growth will be in the order of five per cent, while weaker years will see just 2 to 3 per cent growth.”
Mr Mellor said Australia is unlikely to see the rapid growth of previous years again anytime soon. “That growth was stimulated by various incentives, and as we are unlikely to see incentives return, we won’t see extraordinary growth return either."
Monday, May 9, 2011
Rate Rises begin to bite
The Herald Sun reports that:
"ANZ Banking Group boss Mike Smith has revealed his growing concern at how rising interest rates are affecting the ability of some consumers to repay their loans.
He said yesterday poor credit quality was a concern because people were not paying off their credit cards.
Mr Smith's comments on ABC television follow Westpac chief Gail Kelly who, earlier last week, acknowledged a rise in consumer arrears, but said it was not at a level to cause the bank a loss.
Mr Smith said poor credit quality at this time was strange because it normally occurred during periods of rising unemployment.
He said it now appeared to be seasonally related, noting a little bit of a situation where people were going on holidays and not repaying the monthly debt on their credit cards.
"But I think that interest rates are beginning to hurt a little bit now, so the recent rises are beginning to bite," he said, adding that the Queensland floods had contributed to the issue."
Regarding exchange rates, Mr Smith said the Aussie dollar would continue to rise.
"I think we will see it move through $1.10 and get even stronger than that," he said.
"I can't see anything that will knock it off the perch because it's not only the strong Australian dollar, it's also the weak US dollar.
"When you think about what is happening in the States, I can't see them increasing rates for at least 18 months."
"ANZ Banking Group boss Mike Smith has revealed his growing concern at how rising interest rates are affecting the ability of some consumers to repay their loans.
He said yesterday poor credit quality was a concern because people were not paying off their credit cards.
Mr Smith's comments on ABC television follow Westpac chief Gail Kelly who, earlier last week, acknowledged a rise in consumer arrears, but said it was not at a level to cause the bank a loss.
Mr Smith said poor credit quality at this time was strange because it normally occurred during periods of rising unemployment.
He said it now appeared to be seasonally related, noting a little bit of a situation where people were going on holidays and not repaying the monthly debt on their credit cards.
"But I think that interest rates are beginning to hurt a little bit now, so the recent rises are beginning to bite," he said, adding that the Queensland floods had contributed to the issue."
Regarding exchange rates, Mr Smith said the Aussie dollar would continue to rise.
"I think we will see it move through $1.10 and get even stronger than that," he said.
"I can't see anything that will knock it off the perch because it's not only the strong Australian dollar, it's also the weak US dollar.
"When you think about what is happening in the States, I can't see them increasing rates for at least 18 months."
Thursday, April 21, 2011
Shift on Transport Issues
This post is from a correspondent to this blog:
Ministers responsible (in the new O'Farrell Coalition NSW Gov) for the difficult to solve land use & transport interaction problem in Sydney appear to realize that the 'culture of arrogance' (which can lead to deceit & manipulation), under which the NSW RTA has operated for far too long must end. Expensive major roads and so-called 'upgrades' presented as transport solutions are doomed to failure due to traffic induction which feeds into & causes congestion in supporting road networks.
Real solutions are only available from integrated public transport which is service oriented & for commuters is cost effective, easily accessed & safe. The North West Rail Link (NWRL) is an urgently needed solution as long overdue public transport infrastructure. Having previously represented the M2 impacted area of North West Sydney (as member for the former NSW seat of Northcott) Barry O'Farrell has the background knowledge to understand the urgent need for critical rail & supporting feeder bus infrastructure in NW Sydney.
Fortunately, his overwhelming victory in the recent 26 Mar NSW Elections has given the mandate to begin fixing the problems created by previous governments pursuing NO SOLUTION public policy outcomes often manipulated through the political decision making process as NSW RTA 'wish list' initiatives... The issue of political facilitators previously assisting road building vested interests needs to be addressed by a Royal commission with coercive powers.
The issue of OPTIMUM size for a large city like Sydney also needs proper inquiry under arrangements with full transparency.
Ministers responsible (in the new O'Farrell Coalition NSW Gov) for the difficult to solve land use & transport interaction problem in Sydney appear to realize that the 'culture of arrogance' (which can lead to deceit & manipulation), under which the NSW RTA has operated for far too long must end. Expensive major roads and so-called 'upgrades' presented as transport solutions are doomed to failure due to traffic induction which feeds into & causes congestion in supporting road networks.
Real solutions are only available from integrated public transport which is service oriented & for commuters is cost effective, easily accessed & safe. The North West Rail Link (NWRL) is an urgently needed solution as long overdue public transport infrastructure. Having previously represented the M2 impacted area of North West Sydney (as member for the former NSW seat of Northcott) Barry O'Farrell has the background knowledge to understand the urgent need for critical rail & supporting feeder bus infrastructure in NW Sydney.
Fortunately, his overwhelming victory in the recent 26 Mar NSW Elections has given the mandate to begin fixing the problems created by previous governments pursuing NO SOLUTION public policy outcomes often manipulated through the political decision making process as NSW RTA 'wish list' initiatives... The issue of political facilitators previously assisting road building vested interests needs to be addressed by a Royal commission with coercive powers.
The issue of OPTIMUM size for a large city like Sydney also needs proper inquiry under arrangements with full transparency.
Home Insulation Test Results
One in four homes inspected after the Federal Government's botched home insulation scheme had varying levels of safety risk and did not meet national building safety standards.
To quote Alison Rehn of the Daily Telegraph, "the disastrous $2.45 billion pink batts program" was axed 12 months ago following the deaths of four installers, many reported injuries, 205 house fires, and scores of complaints about shonky installations and dodgy operators.
Some 58,000 houses had foil insulation fitted. Because of the higher perceived hazard risk with this material, the Government committed to inspect every foil-fitted house, and of the 44,000 inspected so far nearly a third have had the insulation removed, and half of the rest needed safety switches installed.
About 1,100,000 homes had non-foil products installed, perceived to be less of a hazard. However of the 141,000 homes fitted with non-foil insulation products that were targeted for safety inspections, 34,000 (24%) did not comply with standards. The paper doesn't explain why the Government proposed only to inspect little more than ten percent of the houses with non-foil insulation. Perhaps now that the results are in, showing that 24% of those inspected are defective, they will reconsider, and should consider testing all the remaining 83,000 homes!
A number of legal claims are in the offing. One also wonders if anything is being done to compensate the poor honest businesses who stocked up on insulation material only to have the demand slashed by the cancellation of the program.
Alison's word, "disastrous", is certainly appropriate.
To quote Alison Rehn of the Daily Telegraph, "the disastrous $2.45 billion pink batts program" was axed 12 months ago following the deaths of four installers, many reported injuries, 205 house fires, and scores of complaints about shonky installations and dodgy operators.
Some 58,000 houses had foil insulation fitted. Because of the higher perceived hazard risk with this material, the Government committed to inspect every foil-fitted house, and of the 44,000 inspected so far nearly a third have had the insulation removed, and half of the rest needed safety switches installed.
About 1,100,000 homes had non-foil products installed, perceived to be less of a hazard. However of the 141,000 homes fitted with non-foil insulation products that were targeted for safety inspections, 34,000 (24%) did not comply with standards. The paper doesn't explain why the Government proposed only to inspect little more than ten percent of the houses with non-foil insulation. Perhaps now that the results are in, showing that 24% of those inspected are defective, they will reconsider, and should consider testing all the remaining 83,000 homes!
A number of legal claims are in the offing. One also wonders if anything is being done to compensate the poor honest businesses who stocked up on insulation material only to have the demand slashed by the cancellation of the program.
Alison's word, "disastrous", is certainly appropriate.
Wednesday, April 13, 2011
Incentives Hurt Housing Market
A stimulating article on the back page of the Australian on Monday 11 April by David Uren starts by saying "Demand for homes is falling and the supply is rising." Interesting items in the article include: "First home buyer grants, variable rate mortgages and capital gains tax concessions all served to destabilise housing markets." "The Australian housing market is in a worse state than is widely understood. Demand is falling, supply is rising, and the monthly turnover is drifting lower." "There were a record 260,000 properties advertised for sale in the four weeks to 3 April, 24.1% more than a year ago when the market was booming." Monthly sales peaked in May 2010 at 37,500, and by December 2010 were down to 27,500. That translates to over nine months supply of houses on the market. Later David argues: "Australia's property investors are driven by capital gain, not by rental yield. With the increasing weakness in the capital gain outlook, investors are deserting the market." The point about variable rate mortgages is interesting. "People are encouraged to enter the market during periods of low interest rates without fully appreciating the interest rate risk they are taking on."
Friday, March 25, 2011
Residents dismayed by High Rise plan
Residents around Whiteside Ave North Ryde protested in the streets last Sunday about a proposal to develop a site opposite the Optus building to take 270 units in an area currently restricted to two storeys.
The proposal is to build five structures ranging from three to eleven stories! Of course the developer is hoping to use the Labor government's Part 3A powers to approve this.
Victor Dominello, State Liberal MP for Ryde, said that if the Liberals win government at the election this Saturday, one of the first tasks will be to review all outstanding applications submitted under Part 3A.
The proposal is to build five structures ranging from three to eleven stories! Of course the developer is hoping to use the Labor government's Part 3A powers to approve this.
Victor Dominello, State Liberal MP for Ryde, said that if the Liberals win government at the election this Saturday, one of the first tasks will be to review all outstanding applications submitted under Part 3A.
Tuesday, March 22, 2011
Barangaroo Remediation
Extracted from 7 News, by Caris Bizzaca:
NSW Premier Kristina Keneally is under siege from the Opposition, Greens and action groups who say the government has undermined a court case by exempting Sydney's Barangaroo site from environmental laws.
Planning minister Tony Kelly on Wednesday gazetted an order that effectively excises Barangaroo from his department's own planning laws for managing contamination, just days before the government goes into caretaker mode ahead of the state election.
The Sydney Harbour site is at the centre of a case in the Land and Environment Court being pursued by Australians for Sustainable Development (AfSD), a group concerned about contaminated subsoil.
Opposition spokesperson for planning Brad Hazzard said on Thursday it was an "abuse of process".
"The signature on the planning document may be Tony Kelly's but Kristina Keneally's fingerprints are all over it," he said in a statement.
"In September, Ms Keneally confirmed that she was, 'taking direct responsibility and control of Barangaroo' - so there's no ducking that this rotten act is all hers.
"This is an abuse of process and Kristina Keneally is in it up to her eyeballs showing that NSW Labor has no respect for the rule of law and the NSW community."
But Ms Keneally denied she was behind the order.
"This is a planning decision," she said while campaigning in Sydney.
"I am not the minister for planning."
Ms Keneally, who assumed ministerial responsibility for the $6 billion project last September, said she heard about Mr Kelly's action on Wednesday and spoke with him on Thursday morning.
She defended Mr Kelly saying he had simply made a "technical clarification".
NSW Premier Kristina Keneally is under siege from the Opposition, Greens and action groups who say the government has undermined a court case by exempting Sydney's Barangaroo site from environmental laws.
Planning minister Tony Kelly on Wednesday gazetted an order that effectively excises Barangaroo from his department's own planning laws for managing contamination, just days before the government goes into caretaker mode ahead of the state election.
The Sydney Harbour site is at the centre of a case in the Land and Environment Court being pursued by Australians for Sustainable Development (AfSD), a group concerned about contaminated subsoil.
Opposition spokesperson for planning Brad Hazzard said on Thursday it was an "abuse of process".
"The signature on the planning document may be Tony Kelly's but Kristina Keneally's fingerprints are all over it," he said in a statement.
"In September, Ms Keneally confirmed that she was, 'taking direct responsibility and control of Barangaroo' - so there's no ducking that this rotten act is all hers.
"This is an abuse of process and Kristina Keneally is in it up to her eyeballs showing that NSW Labor has no respect for the rule of law and the NSW community."
But Ms Keneally denied she was behind the order.
"This is a planning decision," she said while campaigning in Sydney.
"I am not the minister for planning."
Ms Keneally, who assumed ministerial responsibility for the $6 billion project last September, said she heard about Mr Kelly's action on Wednesday and spoke with him on Thursday morning.
She defended Mr Kelly saying he had simply made a "technical clarification".
Friday, March 18, 2011
Property as an Asset
A really interesting article in The Economist 5th March starts by saying "Property is widely seen as a safe asset. It is arguably the most dangerous of all."
The article, by Andrew Palmer, includes some interesting thoughts:
People buy property for various reasons, but dominant amongst those motives is financial gain. This mixture of motives can be toxic for financial stability. If housing were like any other consumer good, rising prices should dampen demand. But with property, higher prices are seen as a signal to buy. What happens if prices start to drop?
The value of any particular home is set by the latest local transactions. One absurd bid can push up prices for lots of people living nearby. But has it changed the intrinsic value of those properties?
An analysis shows that in America for the past 30 years renting was better financially than buying (but only if the renter meticulously saves the difference between the rent and what a mortgage would be costing).
The article, by Andrew Palmer, includes some interesting thoughts:
People buy property for various reasons, but dominant amongst those motives is financial gain. This mixture of motives can be toxic for financial stability. If housing were like any other consumer good, rising prices should dampen demand. But with property, higher prices are seen as a signal to buy. What happens if prices start to drop?
The value of any particular home is set by the latest local transactions. One absurd bid can push up prices for lots of people living nearby. But has it changed the intrinsic value of those properties?
An analysis shows that in America for the past 30 years renting was better financially than buying (but only if the renter meticulously saves the difference between the rent and what a mortgage would be costing).
Thursday, March 17, 2011
John McGrath Hates Underquoting
John McGrath's blog of 12 April 2010, responding to a question about underquoting, says:
"Hey Sonja, I agree, it's a pet hate of mine too. Guides should reflect the Agent's opinion and the Vendor's expectation. I hope it wasn’t a sale connected with our firm but if it was please let me know so I can look at it right away. John McGrath."
John, you should check out the 14 Allerton sale last month. Quote price $900,000, sale price $1,117,000, 24% over guide! Yet a comparable house next door sold a year ago for $1,116,000 so luckily for Wayne this one sold below market price.
While you are at it, John, check out all the other recent Wayne Vaughan sales:
8 Dennistone Rd Eastwood 20% over guide.
17 Railway Ave Eastwood 19% over guide.
55 Eastview Ave N Ryde 19% over guide.
74 Ray Road Epping 14% over guide.
24 Angus Avenue Epping 12% over guide.
He almost got 1/17 Pinner Close N Epping right, only 9% over guide.
Wayne is in good company though, Betty Ockerlander of Better Homes clocked up:
41 Stanley Rd Epping 18% over guide.
30 Surrey St Epping 17% over guide.
28 Cecil St Dennistone E 16% over guide.
Come on, OFT, protect the buyers. Let's see some prosecutions to stamp out this pernicious practice. Unfortunately the maximum fine is only $22,000, which is less than the commission, but the OFT can take away the licence of repeat offenders.
Wayne is now being investigated by OFT, so will have to be careful not to sell any of his present under-quoted listings for the correct market price, or he could lose his licence. An interesting problem for an agent, trying to persuade buyers to settle below market price!
"Hey Sonja, I agree, it's a pet hate of mine too. Guides should reflect the Agent's opinion and the Vendor's expectation. I hope it wasn’t a sale connected with our firm but if it was please let me know so I can look at it right away. John McGrath."
John, you should check out the 14 Allerton sale last month. Quote price $900,000, sale price $1,117,000, 24% over guide! Yet a comparable house next door sold a year ago for $1,116,000 so luckily for Wayne this one sold below market price.
While you are at it, John, check out all the other recent Wayne Vaughan sales:
8 Dennistone Rd Eastwood 20% over guide.
17 Railway Ave Eastwood 19% over guide.
55 Eastview Ave N Ryde 19% over guide.
74 Ray Road Epping 14% over guide.
24 Angus Avenue Epping 12% over guide.
He almost got 1/17 Pinner Close N Epping right, only 9% over guide.
Wayne is in good company though, Betty Ockerlander of Better Homes clocked up:
41 Stanley Rd Epping 18% over guide.
30 Surrey St Epping 17% over guide.
28 Cecil St Dennistone E 16% over guide.
Come on, OFT, protect the buyers. Let's see some prosecutions to stamp out this pernicious practice. Unfortunately the maximum fine is only $22,000, which is less than the commission, but the OFT can take away the licence of repeat offenders.
Wayne is now being investigated by OFT, so will have to be careful not to sell any of his present under-quoted listings for the correct market price, or he could lose his licence. An interesting problem for an agent, trying to persuade buyers to settle below market price!
Wednesday, March 16, 2011
Fair Trading disqualifies agents
Two central coast real estate agents have had their licenses revoked by NSW Fair Trading.
Kevin Barnes and Nicole Mars were disqualified from practising as estate agents for 10 and six years respectively, after the duo were found to have obtained $500,000 profit in a property sale.
Fair Trading took action against the pair after a compliant came through from Housing NSW concerning the sale of a property at 1-3 Walmsley Road, Ourimbah.
Fair Trading deputy commissioner Steve Griffin said Fair Trading would continue to take decisive action when real estate agents and businesses acted inappropriately in putting their own interests before that of their clients.
Nice to see Fair Trading showing teeth! There is a great need for this in the real estate industry!
Kevin Barnes and Nicole Mars were disqualified from practising as estate agents for 10 and six years respectively, after the duo were found to have obtained $500,000 profit in a property sale.
Fair Trading took action against the pair after a compliant came through from Housing NSW concerning the sale of a property at 1-3 Walmsley Road, Ourimbah.
Fair Trading deputy commissioner Steve Griffin said Fair Trading would continue to take decisive action when real estate agents and businesses acted inappropriately in putting their own interests before that of their clients.
Nice to see Fair Trading showing teeth! There is a great need for this in the real estate industry!
Friday, March 11, 2011
McGrath Underquoting Again
No doubt the large crowd at the auction of 4 Allerton Road Beecroft were surprised when the advertised price of "Guide over $900,000" resulted in an auction with 69 bids! The first wildly optimistic bid was for $875,000. Bidding then leapt away in $25,000 steps until finally a realistic market sale price of $1,117,000 was reached, 25% above the McGrath Guide Price.
A newly listing vendor says that they went with McGrath because they explained to her that this is their technique. Once people have paid to do building and pest inspections for a property that seems to be a bargain, they will come to the auction and might continue bidding way beyond the limit they had set themselves. Great policy for the vendors, but unkind to the poor buyers who spend their money with no prospect of buying the property.
It is actually also against the law. Trouble is, the Fair Trading Minister's people typically fine the agency $2,200 which is seen as just a trivial tax on a sale which realises commission of $24,000 or more. Apparently the maximum fine is $22,000, so still just matching commission. So the only real threat is loss of licence, which penalty should be applied for repeat offenders!
It's amusing that in 2008, when McGrath was fined for this, John McGrath's response was "I'm obviously disappointed. We've had a great reputation for the exact opposite of this," and no doubt smiled as he said "I think the only thing we're guilty of is achieving a good price for our vendors." Or to put it another way, "Bugger the Buyers". But it's not a fair comment anyway, because a nearly identical property next door sold nearly a year ago for $1,116,000, so the McGrath sale price was at best market value.
Read more: http://www.news.com.au/business/real-estate-agents-busted-for-low-quotes/story-e6frfm1i-1111116430288#ixzz1GFhh9Skd
A newly listing vendor says that they went with McGrath because they explained to her that this is their technique. Once people have paid to do building and pest inspections for a property that seems to be a bargain, they will come to the auction and might continue bidding way beyond the limit they had set themselves. Great policy for the vendors, but unkind to the poor buyers who spend their money with no prospect of buying the property.
It is actually also against the law. Trouble is, the Fair Trading Minister's people typically fine the agency $2,200 which is seen as just a trivial tax on a sale which realises commission of $24,000 or more. Apparently the maximum fine is $22,000, so still just matching commission. So the only real threat is loss of licence, which penalty should be applied for repeat offenders!
It's amusing that in 2008, when McGrath was fined for this, John McGrath's response was "I'm obviously disappointed. We've had a great reputation for the exact opposite of this," and no doubt smiled as he said "I think the only thing we're guilty of is achieving a good price for our vendors." Or to put it another way, "Bugger the Buyers". But it's not a fair comment anyway, because a nearly identical property next door sold nearly a year ago for $1,116,000, so the McGrath sale price was at best market value.
Read more: http://www.news.com.au/business/real-estate-agents-busted-for-low-quotes/story-e6frfm1i-1111116430288#ixzz1GFhh9Skd
Thursday, March 10, 2011
Back on the Gas
On the front page of the Northern District Times this week is an article about an independent petrol station starting up again on the corner of Blaxland and Lovell Roads in Eastwood. The demise of independent petrol stations has been a sad result of Coles and Woolworth discounting, and it is a real pleasure to see a movement to open some of them up again.
Saturday, March 5, 2011
Property Choice Keeping Prices Down
An article in today's Sydney Morning Herald says "prices remain under pressure as discounting increases to secure sales".
Auctioneer Damien Cooley is quoted as saying, "The majority of sellers are becoming a lot more realistic about what their home is worth".
Auctioneer Damien Cooley is quoted as saying, "The majority of sellers are becoming a lot more realistic about what their home is worth".
Friday, March 4, 2011
EcoTransit Sydney Forum Sunday 6 March
EcoTransit Sydney are hosting a community forum at which Liberal, Labor and Greens transport spokespeople will explain their policies on expanding rail services in NW Sydney, and in particular on delivering the long promised North West Rail Link.
Sunday 6 March at 7pm, in the Pennant Hills Community Centre, corner of Yarrara and Ramsay Roads, Pennant Hills.
Come along, listen to the speakers, and have your say.
Sunday 6 March at 7pm, in the Pennant Hills Community Centre, corner of Yarrara and Ramsay Roads, Pennant Hills.
Come along, listen to the speakers, and have your say.
Rail link key in state's growth
This article by Brian Robins is from the SMH, March 3, 2011.
The north-west rail link is the most worthwhile public transport project the state government should pursue, since it has the greatest economic spinoff, research has found. Modelling by the Centre for International Economics, on behalf of the Property Council of Australia, used the multi-criteria approach adopted by Infrastructure Australia, the federal body which has refused to fund most projects nominated by the state due to inadequate assessment and planning.
''Our recent survey of Sydney residents showed just 3 per cent felt we have a good road network and only 32 per cent gave a tick to our public transport system,'' the executive director of the Property Council, Glenn Byers, said. ''It's no surprise the north-west rail link is the highest ranked public transport project in testing its economic upside and strategic importance to Sydney's growth.''
The survey, which ranked a series of transport projects across 16 criteria and then assessed them in terms of which would give the greatest economic fillip to the state's economy, found that taking freight heading to the Botany port off the roads and putting it onto rail would have the greatest single economic impact.
''Collectively, these projects would deliver a $5.8 billion boost to the economy, representing a 1.1 per cent growth in real gross state product,'' Mr Byers said.
By 2020, the projects would help boost employment by creating 5700 jobs and boosting exports by 3.5 per cent, in real terms, the study found. ''The transport projects lead to a larger NSW economy that produces more, exports more and employs more,'' the study found. ''The projects also lead to greater investment in NSW and lower prices for NSW consumers.''
The state government should establish a portfolio of Infrastructure, Planning and Transport, along with an independent infrastructure and planning commission and an independent body similar to Infrastructure Australia to assess, prioritise and help deliver large projects. Taking freight bound for Port Botany off the road involves upgrades to road and rail links in Moorebank, Ingleburn, Minto and Eastern Creek.
The most expensive project would be the M4 East and tunnel to Port Botany, at $9.1 billion, followed by the Western Express, city relief line and Harbour rail link at $8.5 billion. The onus of these projects would be especially acute, since they would be largely funded out of the state budget, with only limited alternative funding prospects, the study found. Similarly, helping improve the position of the Epping-Parramatta rail link in the study was the promise of sizeable federal funding, 80 per cent of the total, it noted.
This story was found at: http://www.smh.com.au/nsw/state-election-2011/rail-link-key-in-states-growth-20110302-1bey2.html
The north-west rail link is the most worthwhile public transport project the state government should pursue, since it has the greatest economic spinoff, research has found. Modelling by the Centre for International Economics, on behalf of the Property Council of Australia, used the multi-criteria approach adopted by Infrastructure Australia, the federal body which has refused to fund most projects nominated by the state due to inadequate assessment and planning.
''Our recent survey of Sydney residents showed just 3 per cent felt we have a good road network and only 32 per cent gave a tick to our public transport system,'' the executive director of the Property Council, Glenn Byers, said. ''It's no surprise the north-west rail link is the highest ranked public transport project in testing its economic upside and strategic importance to Sydney's growth.''
The survey, which ranked a series of transport projects across 16 criteria and then assessed them in terms of which would give the greatest economic fillip to the state's economy, found that taking freight heading to the Botany port off the roads and putting it onto rail would have the greatest single economic impact.
''Collectively, these projects would deliver a $5.8 billion boost to the economy, representing a 1.1 per cent growth in real gross state product,'' Mr Byers said.
By 2020, the projects would help boost employment by creating 5700 jobs and boosting exports by 3.5 per cent, in real terms, the study found. ''The transport projects lead to a larger NSW economy that produces more, exports more and employs more,'' the study found. ''The projects also lead to greater investment in NSW and lower prices for NSW consumers.''
The state government should establish a portfolio of Infrastructure, Planning and Transport, along with an independent infrastructure and planning commission and an independent body similar to Infrastructure Australia to assess, prioritise and help deliver large projects. Taking freight bound for Port Botany off the road involves upgrades to road and rail links in Moorebank, Ingleburn, Minto and Eastern Creek.
The most expensive project would be the M4 East and tunnel to Port Botany, at $9.1 billion, followed by the Western Express, city relief line and Harbour rail link at $8.5 billion. The onus of these projects would be especially acute, since they would be largely funded out of the state budget, with only limited alternative funding prospects, the study found. Similarly, helping improve the position of the Epping-Parramatta rail link in the study was the promise of sizeable federal funding, 80 per cent of the total, it noted.
This story was found at: http://www.smh.com.au/nsw/state-election-2011/rail-link-key-in-states-growth-20110302-1bey2.html
M2 upgrade contract should be cancelled
John Goldberg had this letter published in the Northern District Times on 5 Jan. It is worth repeating now the state election is nearing, and with the EcoTransit Forum taking place on Sunday 6th at the Pennant Hills Community Centre at 7pm.
"Understandable attempts by the Transurban interests to talk up the “benefits” of the M2 upgrade in terms of travel time savings have little credibility (“M2 rubbishes ‘no benefit claim’”. NDT 15 December). The claims of travel time savings are part of a derisible economic analysis prepared by a Transurban consultant with the clear aim of justifying the project.
"The claims have been shown to be spurious by the author in a paper to be published shortly in the refereed Proceedings of the 2010 Australasian Transport Research Forum based on the author’s research at the University of Sydney. The results already reported in the Sydney Morning Herald (7/10/2010) show that Transurban overstated the savings by a factor of four times. This result means that the savings are worth far less than the cost of the project over its concession lifetime.
"Why then proceed with this uneconomic project which will be of minimal benefit to road users? The real reason lies in the need for Transurban to generate increased cash flow. In 2010, the total expenses of Transurban exceeded its total earnings by $234.60 million, and its group debt is over $7 billion and keeps rising. Yet Transurban continues to assert group profitability.
"Increased revenue is to be obtained by taking advantage of induced traffic. This will have the effect of increasing congestion, reducing travel time savings but it is likely to increase revenue. These hopes have been publicly expressed by Mr C.J.Lynch the CEO of the Transurban Group(The Australian, 15-16/5/2010) while the possibility of induced traffic has been marginalised, not unexpectedly, in the EIS published by Transurban and endorsed by the RTA.
"The M2 upgrade affair generally demonstrates that transport planning in a major Australian city cannot be reliably carried out by incompetent agencies such as the RTA using deception and community manipulation disguised as consultation. There is no substance in this M2 upgrade project which would support Kristina Keneally’s2009 claim, clearly influenced by the RTA, that the M2 upgrade project was “critical” infrastructure and one of “state significance”.
"The incoming government should therefore invoke the doctrine of executive necessity and cancel the contract for this essentially fraudulent project and also undertake serious reform of the RTA."
"Understandable attempts by the Transurban interests to talk up the “benefits” of the M2 upgrade in terms of travel time savings have little credibility (“M2 rubbishes ‘no benefit claim’”. NDT 15 December). The claims of travel time savings are part of a derisible economic analysis prepared by a Transurban consultant with the clear aim of justifying the project.
"The claims have been shown to be spurious by the author in a paper to be published shortly in the refereed Proceedings of the 2010 Australasian Transport Research Forum based on the author’s research at the University of Sydney. The results already reported in the Sydney Morning Herald (7/10/2010) show that Transurban overstated the savings by a factor of four times. This result means that the savings are worth far less than the cost of the project over its concession lifetime.
"Why then proceed with this uneconomic project which will be of minimal benefit to road users? The real reason lies in the need for Transurban to generate increased cash flow. In 2010, the total expenses of Transurban exceeded its total earnings by $234.60 million, and its group debt is over $7 billion and keeps rising. Yet Transurban continues to assert group profitability.
"Increased revenue is to be obtained by taking advantage of induced traffic. This will have the effect of increasing congestion, reducing travel time savings but it is likely to increase revenue. These hopes have been publicly expressed by Mr C.J.Lynch the CEO of the Transurban Group(The Australian, 15-16/5/2010) while the possibility of induced traffic has been marginalised, not unexpectedly, in the EIS published by Transurban and endorsed by the RTA.
"The M2 upgrade affair generally demonstrates that transport planning in a major Australian city cannot be reliably carried out by incompetent agencies such as the RTA using deception and community manipulation disguised as consultation. There is no substance in this M2 upgrade project which would support Kristina Keneally’s2009 claim, clearly influenced by the RTA, that the M2 upgrade project was “critical” infrastructure and one of “state significance”.
"The incoming government should therefore invoke the doctrine of executive necessity and cancel the contract for this essentially fraudulent project and also undertake serious reform of the RTA."
Saturday, February 26, 2011
CBA cuts loan rate
The CBA has launched a fee-free standard mortgage at a rate of just 7.24%! Currently Westpac charges 7.86%, ANZ 7.8%, and NAB 7.67%.
Long live competition!
Long live competition!
Friday, February 25, 2011
Australians struggle to enter property market
The following is extracted from today's Real Estate Business:
Australia’s housing affordability problem shows no sign of abating, according to recent figures.
Data from the Australian Bureau of Statistics found residential construction work done fell by 1.1 per cent in the December 2010 quarter.
New residential building work done fell by 1.7 per cent in the December 2010 quarter, following the 5.2 per cent decline in the September 2010 quarter.
On a more positive note, work done on major alterations and additions is again growing, turning in a 2.5 per cent increase for the December 2010 quarter to be up by 6.3 per cent over 2010.
Housing Industry Association senior economist Andrew Harvey said renovations continue to be popular as Australians increasingly look to improve their existing homes rather than face the mounting transaction costs, such as stamp duties, that they will incur if they trade-up to another property.
“Unfortunately Australia’s high property transactions costs do not help the problem of Australia’s undersupply of housing, nor the affordability problems faced by both prospective home owners and those in the market for rental property,” Mr Harvey said.
“Recently the OECD found that Australia has the fourth highest transactions cost on property in the developed world and this situation causes major inefficiencies in terms of locking owners into their existing properties.
"Australian governments need to turn their attention to removing stamp duties on new homes so as to better encourage annual levels of new home building that will help ease the pressure on prospective home owners, particularly young Australians who are really struggling to enter the housing market."
Australia’s housing affordability problem shows no sign of abating, according to recent figures.
Data from the Australian Bureau of Statistics found residential construction work done fell by 1.1 per cent in the December 2010 quarter.
New residential building work done fell by 1.7 per cent in the December 2010 quarter, following the 5.2 per cent decline in the September 2010 quarter.
On a more positive note, work done on major alterations and additions is again growing, turning in a 2.5 per cent increase for the December 2010 quarter to be up by 6.3 per cent over 2010.
Housing Industry Association senior economist Andrew Harvey said renovations continue to be popular as Australians increasingly look to improve their existing homes rather than face the mounting transaction costs, such as stamp duties, that they will incur if they trade-up to another property.
“Unfortunately Australia’s high property transactions costs do not help the problem of Australia’s undersupply of housing, nor the affordability problems faced by both prospective home owners and those in the market for rental property,” Mr Harvey said.
“Recently the OECD found that Australia has the fourth highest transactions cost on property in the developed world and this situation causes major inefficiencies in terms of locking owners into their existing properties.
"Australian governments need to turn their attention to removing stamp duties on new homes so as to better encourage annual levels of new home building that will help ease the pressure on prospective home owners, particularly young Australians who are really struggling to enter the housing market."
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