White Paper – July 2012


What happened to the markets in June?

Over the years, from time to time, we hear experts make the case that New Zealand should become the 7th state of Australia! You know how it goes – common currency free movement of goods and people between the countries etc. Of course, nothing ever happens.

But for those of us in property, however, the ideal answer right now would be for Australia to become the second province of New Zealand! Why? Well, the enthusiasm for property right across New Zealand – particularly in Auckland – makes all those of us in property in Australia envious. Right from the beginning of this calendar year, activity in New Zealand’s residential sector has just blossomed. The story covered on the front page of the New Zealand Herald describes how one property increased in value in Auckland by 43%.

At least, for the Aussies there is some good from this – reviving evidence in the inevitablity of property cycles? Our New Zealand offices were 31% up on June 2011. The Canterbury earthquake and the forced movement of 6000 property owners is the main reason behind the lift in sales particularly in Auckland and Canterbury. More information here. Some promising news in Australia? Well – RP Data announced the capital city prices in Australia had increased by 1% in the month of June. 1%! – indeed!

In June, there was similar feedback across all state markets in Australia. A little bit stronger but no sign of any emerging surge. It was only a few years ago when Sydney and Melbourne were standouts in holding the Australian market to a level of respectability. But this has eased over the last 6 – 12 months. At least there is more confidence in Western Australia and Queensland which was long overdue! All in all the group total is a respectable $2.2billion for June. We dearly hope this will be dramatically increased this time next year!

Once more the Loan Market results were above last year reflecting the continuing interest of people who understand their financial capacity – always the first step in the buying cycle! The Reserve Bank in Australia declined to move on Interest Rates last week citing that the “current monetary policy appears appropriate”. For more on the Reserve Bank’s decision click here http://www.rba.gov.au/media-releases/2012/mr-12-16.html Loan Market unconditional approvals were up 5% on June 2011 with WA up a massive 58% on last year and QLD up a respectable 19%!

What’s New at Ray White

Reflecting the increasing appeal of inner city living, the group is pleased to announce five new offices to exploit the inner city markets of Sydney and Melbourne. Opening in a terrific new premise is our new Walsh Bay office and we will also be opening in Sydney’s CBD (with more details next month). In Melbourne, Andrew Salvo is opening in spectacular premises in Southbank. The same goes in Auckland where we are capitalising already on our strong position to open several more businesses in Auckland Central. We are excited about where this will take us.

During the month we launched Ray White Projects, bringing together 18 project marketing specialists into one team across 8 businesses in Sydney, Brisbane, Gold Coast, Darwin, Auckland, Queenstown and Bali. We are currently marketing 19 projects across these markets.

A group can be excused for an over-exuberance when a complex sale of 12 months duration is finally approved and settlement has commenced. This is the $400million sale we referred to earlier and created by Andrew Jolliffe. Andrew Jolliffe commenced with the company just over 12 months ago and has deepened the skill sets we now have in Ray White. The deal comprised Woolworth’s purchasing the leasehold rights of 35 hotels in Sydney and adjoining areas. It revealed the confidence Woolworth’s now have in broadening its retailing hospitality skills beyond the Dan Murphy’s bottle shop network.

The group is committed to a significant Hotel division, not only do we have first class sales negotiators but, in addition, we welcome Paul Hall who is creating the appropriate valuation advisory services that will integrate perfectly into our entire Hotel operation.
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