BIS Shrapnel see Victoria Flat for 5 years..

There is good news...

The forecasting firm told a journalists' lunch in Melbourne it was expecting a recovery in NSW, Western Australia, Queensland and Northern Territory in the next few years, with WA the "first cab off the rank", according to senior manager of residential property Angie Zigomanis.

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But not for Victoria:

But Victoria will be left behind, facing level growth for at least the next three years, says BIS Shrapnel, which forecasts vacancy rates will rise in the next year due to a big influx of residential developments currently in the pipeline coming online.

Zigomanis says Victoria could experience falls in capital growth for the next two to three years, and if housing picks up in the other states, as it is forecast to do, the RBA could raise interest rates again by 2015, which would nip Victoria's possible recovery in the bud. In that case, a recovery in the Victorian housing market could be five years off.

The firm is equally bearish on the Victorian economy as a whole, saying unemployment could rise to over 6.5% in the next few years.

"I don't think people realise how bad it's going to be in Victoria," says BIS Shrapnel chief economist Frank Gelber.

But at least Victorians be glad they are not living across the Bass Strait.

"Tasmania's a basket case," says Zigomanis.

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And if your in Tassie....your screwed

http://www.propertyobserver.com.au/...-be-five-years-off-bis-shrapnel/2012120658324

Whats BIS shrapnel's record on forecasting? As good as any other economist?

tobe said:

Whats BIS shrapnel's record on forecasting? As good as any other economist?

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Utter crap as far as I can see looking at their history, they appear to have been far too optimistic with regards to housing in general

Just heard on the radio..Melbourne had a 2% median price growth in the September quarter...no idea of the source...boom town.....

natedog said:

Just heard on the radio..Melbourne had a 2% median price growth in the September quarter...no idea of the source...boom town.....

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QoQ -1% according to RP Data: http://www.rpdata.com/research/daily_indices.html But often the short term changes can change between data providers, I would pay more attention to the longer term trend...

They really need to drop the I out of BIS, sorry but crap record. What ever they forecast the opposite usually occurs, play the BIS contrarian you are guaranteed to win

equitymate said:

They really need to drop the I out of BIS, sorry but crap record. What ever they forecast the opposite usually occurs, play the BIS contrarian you are guaranteed to win

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they have a terrible terrible record, how they get publicity for their predictions is beyond me

Bigtone said:

they have a terrible terrible record, how they get publicity for their predictions is beyond me

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It's because someone needs to rely on their forecasts to justify their excel spreadsheet for the investment banking pitch.

hobo-jo said:

QoQ -1% according to RP Data: http://www.rpdata.com/research/daily_indices.html But often the short term changes can change between data providers, I would pay more attention to the longer term trend...

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Hey Hobo,

The long term is all i look at, the boom town reference was VERY tongue in cheek,

Cheers

I think Victoria is more likely to crash around 30%. Embrace for negative equity boys - you have to have rocks in your head to buy anything.

Deltaberry said:

I think Victoria is more likely to crash around 30%. Embrace for negative equity boys - you have to have rocks in your head to buy anything.

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Agree, especially in the inner ring, no one will want to buy your terraces when you need to liquidate.

If BIS are saying that Vic is looking flat for 5 years it will be the buying opportunity of a lifetime - you can expect a bull run.

Can anyone tell me a good suburb in Vic to purchase a development site? I'd rather get in now before their next report telling me that Vic is leading the nation in growth 3 years from now.

MrCrumbpacker said:

Utter crap as far as I can see looking at their history, they appear to have been far too optimistic with regards to housing in general

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Well it's like when a stock analyst who puts everything as a buy or hold recommendation lists a stock as sell you know the stock must be a real dog.

If they say Victoria is going to be flat for 5 years what they really think about Victoria's prospects is probably considerably more pessimistic.

opinions are like a..holes everyones got one

starter said:

Agree, especially in the inner ring, no one will want to buy your terraces when you need to liquidate.

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Agreed. Who would pay more than $350k for these 100sqm land to be honest? Why wouldn't I spend the same on a 500sqm land in Point Cook? In fact why spend it at all when it's going to crash any way? Right now I can go to Buffalo, which is under 1 hour flight from Manhattan, and buy a big mansion with swimming pool for $30k and live like a king... something's amiss. Either America is grossly undervalued or there's going to be a lot of bankrupt Victorians in 5 months.

Don't say you weren't warned. You heard it here first.

Deltaberry said:

I think Victoria is more likely to crash around 30%. Embrace for negative equity boys - you have to have rocks in your head to buy anything.

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Delta, I think you meant "Brace"...not "embrace"..... Pretty sure you are not telling everyone to go embrace it?

The Y-man

Ahhh yes I meant brace. Don't say you weren't warned in 5 months' time. We all heard it here first.

why in 5 months ?

Deltaberry said:

Right now I can go to Buffalo, which is under 1 hour flight from Manhattan, and buy a big mansion with swimming pool for $30k and live like a king... something's amiss. Either America is grossly undervalued or there's going to be a lot of bankrupt Victorians in 5 months.

Don't say you weren't warned. You heard it here first.

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undervalued I'd say - most cars cost more than $30k. something must be seriously amiss in buffalo, tho 1 hour flying is something like 700kms away at a guess (based on 1.5hr flight time to newman),so it may not sound like long but can put you seriously in the middle of nowhere. 1 hour from London could dump you in almost any hicksville dump in europe?

was curious about this new yorker utopia - OMG sounds like a basket case...from wiki:

Standard of living
The loss of traditional jobs in manufacturing, rapid suburbanization and high costs of labor have led to economic decline, making Buffalo one of the poorest amongst U.S. cities with populations of more than 250,000 people. An estimated 28.7-29.9% of Buffalo residents live below the poverty line, behind either only Detroit,[83] or only Detroit and Cleveland.[84] Buffalo's median household income of $27,850 is third-lowest among large cities, behind only Miami and Cleveland; however the median household income for the metropolitan area is $57,000.[85]
This, in part, has led to the Buffalo-Niagara Falls metropolitan area having the most affordable housing market in the U.S. today. The quarterly NAHB/Wells Fargo Housing Opportunity Index (HOI) noted that nearly 90% of the new and existing homes sold in the metropolitan area during the second quarter were affordable to families making the area's median income of $57,000. The area median price of homes was $75,000.[citation needed]
Buffalo faces issues with vacant and abandoned houses, as the city ranks second only to St. Louis on the list of American cities with the most vacant properties per capita. Since 2000, the city has torn down 2,000 vacant homes but as many as 10,000 still remain. Mayor Byron W. Brown recently unveiled a $100 million, five-year plan to demolish 5,000 more houses