It's all good

If there's a piece of advice worth remembering, "don't declare victory early," is the one not to forget. I say this knowing the housing market is in decline, but the real estate spruiker has a hide thicker than ten inch beef jerky and they don't give up easily, especially not when their highly leveraged hide is on the line.

If you're looking for the most accurate indication of what real estate industry arrogance is about, then look no further. Back on November 4, the Real Estate Industry of Australia issued a press release offering Wayne Swan and Joe Hockey some friendly advice on the banking sector:

The decision to initiate a Senate Inquiry into aspects of the Australian banking sector is positive as the banks need to be examined regarding products offered, fees and charges and the current level of competition between bank and non-bank providers. 

In addition to the Senate Inquiry, REIA notes the Opposition’s Nine Point Plan and agrees the following proposals need further investigation:

• Giving the Australian Competition and Consumer Commission (ACCC) power to investigate collusive price signalling;

• Mandating RBA to formally and regularly report on bank net interest margins, returns on equity and profitability; 

For anyone who hasn't got the joke yet, Tony Soprano has just lobbied the government to make sure Don Vito Corleone doesn't step out of line. Given the dummy bidding, under quoting, unregulated hooliganism that is real estate industry across Australia, why are they prepared to stick their head above the trench and offer advice on how another industry should be regulated? That's one massive set of testicles right there.

If this isn't bad enough, jump forward to today. The REIA issues another press release on the subject of Westpac offering real estate statistics to customers.

An advertisement published by Westpac in today’s capital city newspapers displays the headline, ‘How much is too much for that property?’ The advertisement suggests that property buyers make contact with their Westpac Bank Manager who, according to the advertisement, ‘has the expertise to guide you through your property decisions’.

“This offering should be of great concern to property buyers, sellers and investors,” said Mr Airey.

Apparently Westpac has partnered with Australian Property Monitors and can now provide sales statistics in the bank if you're taking out a loan. I sense a collective shiver going down the spine of every real estate confidence artist in the country. No longer are you guided their emotional rhetoric, you can actually see sales history and recent sales results as you're applying for a loan.

Wow that could be a wet blanket couldn't it?

"That guy only paid that much and I'm taking out a loan for what?"

You might actually know if the arsehole is falling out of the suburb you're about to buy in. That's if you and your bank manager were smart enough to understand these statistics, which you clearly aren't.

“Remote valuations with no physical inspection, nor local knowledge will lead to generalised and unreliable reports, possibly leading buyers into making unrealistic offers...

Don't you dare use this information to low ball!

– it is important that consumers realise the importance of having a property appraised by a qualified real estate professional,” said Mr Airey.

Yes, we continually need our real estate data filtered to us because we have no understanding of the complex nature of the real estate market. Such interpretations should be left to some guy, who twelve months ago, was selling flat screen TV's at Harvey Norman.

“This excursion by banks into real estate should send warning signals to real estate regulators in all states and territories across Australia,” Mr Airey concluded.


Translation: All agents should be on notice, the consumer may now be informed and for Christ sake, will someone regulate these banks, they're upsetting our unregulated spruiktopia!

Which brings me back to Tasmania, where the public is starting to get it, but inexperienced journalists are walking around blind without a cane. Last week, Devonport was bucking the trend according to The Advocate's Jemima Stagg. The evidence couldn't have been more clear - someone bought a $900,000 house.

Yep, that's it.

Jemima feathered us with quotes from the agent, all completely worthless. In fact, it would have been more time effective had the agent took the five minutes to learn a 'pyramid lead,' wrote the story, emailed it to a sub-editor and forgone wasting time with the journalist. As more than one of the respondents to the story virtually said.

Or she could have visited this blog, where I would have told her Devonport isn't bucking anything, that horse has a broken back. Using the baseline I established writing this entry, I found between October 1 and November 14, listings in Devonport increased 10.9%. Furthermore I sampled 253 Devonport dwellings that had been listed for sale longer than two weeks. Their average sit time? 117 days. That's nearly four months without a bid.

The doldrums are here, but the industry doesn't want these doldrums in the media. Remember, we're coming into the silly season, where the media will get even sillier. The experienced members of the media will be sitting on a beach somewhere while the greenhorns man the decks. Perfect timing for the real estate industry to use any piece of nonsense to proclaim the worst is over and the market has returned to normal.

More exciting than Christmas morning will be watching how many times this downturn is conquered over summer.