‘Abolishing negative gearing will lead to sky-rocking rents,’ ‘FHB grants are required to address affordability.’ The private sector actively creates and reinforces urban mythology e.g. Flawed research methodologies are used to reinforce existing heuristics, for instance, to allege the benefits of owning a home outweigh the benefits of renting. Reports simultaneously minimize market negatives and over-emphasize market positives. Their revenues depend on an active, preferably feverish, market. Private sector corporates producing commercial property reports and analysis parrot the FIRE sector narrative.Prices can be up this year, while the five year real price trend is flat or negative. Positive sub-market activity is highlighted and favourable short-term data trends extrapolated to wider themes. Buoyant opinion is preferred and private sector spin doctors provide radiant commentary of the property market at all times, simultaneously proclaiming it both a buyers’ and sellers’ market (an obvious impossibility). The mainstream media remains hopelessly conflicted due to its heavy reliance upon property advertising revenue.Closer examination of Foreign Investment Review Board figures reveals total foreign residential property investment, however, was less than $20 billion dollars in 2011-12 a quantum insufficient to significantly influence housing prices, except perhaps select sub-markets such as the prestige suburbs of Sydney and Melbourne. Foreign investment is reported to be a primary factor in keeping strong demand alive and housing prices at lofty highs.Markets are led to believe they are more constrained than they actually are. Any error or discrepancy will likely lower reporting numbers. These figures are based upon voluntary reporting and are unaudited. Reported rental vacancy rates remain dubiously tight, an artefact of using Real Estate Institute figures from each State/Territory.Stock available for sale is only reported for constrained markets, like Sydney. The total housing stock for sale is rarely reported, particularly by number of month’s supply, a common measure in other jurisdictions.There is no established relationship between auction clearance rates and the health of the broader land market. Auction clearance rates remain dubiously high due to conflicted reporting measures that radically reduce the number of failed auctions disclosed.Several factors help the FIRE sector maintain the illusion that Australian property is not over-priced and keep minds plugged into the Propaganda Matrix: In the nation’s dystopian present, the docile masses remain plugged into the Propaganda Matrix and dare not swallow the red pill, lest their carefully maintained investor reality deconstructs into a non-sanctioned thought crime that questions whether land prices really are at the peak of a once-in-a-century land bubble and mean reversion is imminent. The FIRE sector gorges on a banquet of debt arising from the enslaved collective Australia investor mindset, that has assimilated a carefully constructed reality decreeing bricks and mortar a fail-safe asset class because ‘Australia is different’. The story is an apt metaphor for the FIRE (Finance, Insurance and Real Estate) sector in Australia. In the cult science fiction Matrix movies, people live within a simulated reality created by artificially intelligent machines who feed from their life energy a dream world that has enslaved humanity due to a blissful lack of awareness of the invisible controls.
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