The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Thursday, July 26, 2012

APM's house price index **rises** in Sydney and Melbourne in June qtr...

APM's stratified median house price index, which alongside RP Data-Rismark's hedonic index is closely followed by the RBA, reported that both Sydney and Melbourne house prices increased over the June quarter by +0.2% and +1.6%, respectively. Across the nation, house prices increased by +0.4% over the June quarter. Let me state that again: Melbourne house prices rose by a sharp 1.6% over the three months to end June. Curiously, unit prices, which account for about one quarter of the capital city markets, were weaker, declining by 0.8% nationally. You can see a table summary of house price changes below.

We now have an emerging consensus between the two major house price benchmarks--APM and RP Data-Rismark--that house prices have risen over recent months following the RBA's 75 basis points worth of rate cuts in May and June. RP Data-Rismark's more timely index indicates that the strength of the housing recovery quickened over June and July, where the July data is notably excluded from APM's quarterly index. In 'seasonally-adjusted' terms, the results would be stronger again given May, June, July and August are all seasonally weak months.

These findings contradict what two pundits, Louis Christopher and television host David Koch, have been saying. Readers will recall that Louis Christopher confidently issued a media release in response to RP Data-Rismark's index June and July results declaring, "I do not believe for a moment that house prices are now rising in Sydney or Melbourne as RP Data-Rismark has claimed."

Several days later Sunrise presenter, David Koch, lent support to Mr Christopher's judgements, and informed his readers, "[House price rises are] just not happening yet. So don’t believe everything you read...prices are unlikely to have increased of late."