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."
Sunday, September 30, 2012
Have all the recent house price rises been "seasonal" (charts)?
So here's a key question: what would a seasonally-adjusted version of numbers look like? Applying a standard seasonal-adjustment method to RP Data-Rismark's five capital cities index does not remove the growth. While there has certainly been some seasonal recovery in recent months, less than half a percentage point of the circa three percentage point increase in the Australian five capital city index over the last four months can be explained by seasonal factors. Similarly, the September month numbers still look very strong after you remove seasonal influences.
One final thing I would draw your attention to is the increase in Australian LVRs reported by the RBA. I highlighted this in my AFR column on the weekend (see chart below). It is pretty amazing that nearly 40% of all owner-occupied home loans are approved with LVRs greater than 80%. But what is more remarkable is that 17% of all home loans currently being approved have LVRs greater than 90%. I guess that's okay when house prices are rising...