Saturday, 30 October 2010

Happy Halloween

Both of my little pumpkins have the stomach bug...there is nothing worse! I am hoping we will be better to trick or treat tomorrow night. We carved pumpkins yesterday...I used a stencil and I think they turned out pretty cute.

Friday, 29 October 2010


It's not everyday a guy blows himself up on the North-West of Tasmania. Guy Fawkes night isn't that popular any more, which stops the most industrious Dads passing down their backyard knowledge of fireworks to their kids.

First National Real Estate CEO, Ray Ellis, however is an exception.

Yesterday, Ellis and his unnaturally large set of Captain America white teeth, found himself sitting on a box of dynamite with a quick burning fuse after suggesting, well I'll copy/paste so you can regale in the comedic horror:

"SELFISH" baby boomers are keeping generation Y out of the housing market, First National Real Estate chief executive Ray Ellis believes.

Mr Ellis paid out on what he called the "most self-indulgent, spoilt, want everything for nothing generation that ever existed" in an exclusive interview with The Advocate during a visit to the North- West on Wednesday.

He wants governments to encourage boomers to move into smaller homes to free up housing for younger buyers.

"They want high property prices - so generation Y can't buy a house - so they can continue to lead their self-indulgent lifestyles."

He said boomers controlled the nation's wealth, housing market and economy and wanted that to go on forever.

Understandably, more than one person from that "selfish" generation was keen to lace up their Niblick Walkers and kick Ellis's big white teeth in. They may have to take a number though, given the untold damage this could do to the local First National offices. First National communications manager, Stewart Bunn, really has some work to do helping out the local offices rebuild their image after being associated with this kind of publicity. I'm tipping the owners are currently investigating how quickly they'll be able to re brand themselves. It may be less costly than riding out this storm.

Given RE/Max doesn't have a coastal presence, there may well be one soon.

Ray's biggest boneheaded mistake is ignoring what will take place as people age. The baby boomers are the biggest holders of real estate and consequently have most of their wealth tied up in real estate. They don't need any incentive to downsize, it will be a natural process. Boomers will realise you can't sell off a bedroom when you want to unlock equity. Any cajoling from the likes of Ray Ellis is ludicrous in the extreme, but as is expected from the real estate industry, it's what's best for us, lobby the hell out of government and screw the rest.

Grabbing The Advocate, I found the Ellis farce was not restricted to slagging off baby boomers. In a side article he was also suggesting a statue be erected in honour of Devonport Mayor, Lynn Laycock, because of her support for population growth.

Within another two paragraphs I sensed Ellis had actually slipped into parody and I began to wonder - was this guy a metatroll?

He said population growth led to rising house prices... and to towns becoming the size where they would attract employers like McDonald's, or a second McDonald's.

Open the floodgates please! Higher house prices and a McDonald's on every corner. While that is funny, Ray has done better work in his time.

First National Real Estate CEO, Ray Ellis, is calling for scaremongering real estate analysts to be held accountable, after predicting a ‘housing bubble burst’ or ‘affordability crisis’, amidst claims Australia has the most overpriced property in the world.

To what account would he like an analyst, and let's face it, an honest one who actually urges caution, to be held to? If you read through this blog there's plenty of examples showing what happens when fools rush in.

What does he tell the people who can't sell their house, whose listing has been on the market for six months, they've discounted to the point of negative equity, they find lending figures have gone off a cliff and even worse, listings are now springing up as competition all around them?

Rewinding back to sale day and erasing all the BS real estate myths they fell for isn't an option. Eventually people baulk at taking on greater debt loads to pay bigger prices than the last guy, essentially the fools run out and all indicators are we're at that point.

And how does Ray deal with the 'scaremongering' talk of a bubble? He suggests Australia will be short 600,000 houses by 2015. Scary eh? Fingers crossed it's not you living in a cardboard box.

Finally, as The Advocate investigates on online pay model, they have to be Charlie Sheen/hookers/blow happy with the past few weeks. They've found the lightning rod that attracts the crazies, like me, to their website - real estate stories. Comments in the double figures, increased page clicks from all around Australia and potentially people clicking their ads.

As I'd already pointed out, this would happen (sorry I've become Chris Joye again) so expect to see more real estate stories. Right now 'real estate' has surpassed 'sex crime' as the hot button issue to draw the readers in. Last night, the first story on The Advocate website was up 2 1/2 hours earlier than normal and guess what it was about?

So what better time for The Advocate to buy this site for huge dollars and incorporate it into their website?

Oh damn, that bubble already burst.

Thursday, 28 October 2010


Apologies for the lack of anything substantial this week, unfortunately I do have employment and other things going on. Needless to say little has changed in Tasmania - except for it getting worse. Burnie listings have exploded, so much so, I feel like a bear handler from a former Soviet state when talking about it - I could be up on cruelty charges, it's almost poking a caged animal with a stick at this stage.

Devonport continues to rise and Launceston looks like it's about to blow after adding another fifty plus listings before the week is out.

After reading Jeremy Grantham's latest "Night of the Living Fed" newsletter at work today, I had hoped to present it as some super new news, but David Llewellyn-Smith squeezed me out on that front. I will say, in a moment of Chris Joye pomposity, I'm taking credit for Grantham's follow up, given the fact I made sure GMO was fully aware of the the howling from Australian vested interests to his bubble claims.

Take that with a grain of salt, but I also recently asked GMO to ask behavioural investing expert, James Montier, author of 2005's "Pictures of a Mania? - US Housing Special", to turn his attention to Australia. If he puts out an article, maybe I'm not as pompously ridiculous as I'm currently appearing.

Given that Westpac came out with it's own bubble denials today, along with a goon from BS Shrapnel. I'll draw attention to Montier's criticism of Westpac's self interest back in July:

One of my colleagues sent around a bloomberg article which stated that Westpac (the Aussie bank) had opined that the Basel 3 rules were flawed and risked constraining lenders! Wasn't it unconstraining lending that help get us into the GFC (global financial crisis for non-aussies)?

Why anyone would care what any bank thought of attempts to regulate it remains beyond me. One of the major problems of Basel 2 was that banks were allowed to use their own risk models to value assets. This is akin to asking kids to mark their own homework, one shouldn't be surprised when they report they got 100% correct.

Talk about not learning from mistakes. Hasn't anyone heard of regulatory capture?

Coincidently, guess which bank spent the most time running the rule over this site today?

Monday, 25 October 2010

Home Sales Up in September!

The National Association of Realtors reported that existing home sales rose 10% last month. In addition, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a low 4.35 percent in September. Read more here.

Don't let the media fool is a great time to buy or sell.

Metallic Spray Paint

When I redecorated the end of my hallway a few months ago, I used this lamp from my attic because it was the right size for the space. I wasn't in love with it's look. I decided to spray paint it silver and I still wasn't totally in love but I thought it was an improvement.

Here it is before....

And after....

So I have been working on my dining room and it is no where near complete but I decided to spray paint a few other items.

I liked this monkey but was tired of his finish.

Here he is before...

And after...

I ended up moving him to my living room because I thought the finish went nicely with the frame already placed on this table.

I also spray painted this little vase that came from the Dollar Tree probably 10 years ago.

Before...look can barely see it.


So if you are sick of some of your accessories and want to a fresh look...consider painting. It is cheap and easy.

Sunday, 24 October 2010

Soft Landing

As I woke up with morning breath to make any canine proud, I poked my head out the front door - finding I'd once again left out money for the paper boy, who'd once again delivered me Tasmania's worst newspaper.

I gotta have words with that little creep.

The Launceston rotter, The Examiner, or in this case The Sunday Examiner - an even more uninspiring version of the Monday to Saturday version - is one of those newspapers you can count on to toe the expected business line, while smashing the usual suspects and soft targets with full force. Look out bogans and drink drivers.

Four pages in, readers were treated to an story entitled "Opening doors on property", where Australian Property Monitors, Anthony Ishac was busy sending out some conflicting signals.

The data presented showed Burnie down 11% in the last quarter (I won't be the smart arse who extrapolates that to an annual figure) and Launceston down 2%, which mirrored the state and national decline.

Yet as both markets - Burnie 45% and Launceston 37% - had experienced growth in the last five years, Ishac expected the market to remain strong.


"The market is still seeing healthy returns in the Burnie region but we have been noticing a decline in the last three months," Mr Ishac said.

Yeah, 11% in a quarter would catch your eye, just a little bit.

"The market will stay strong because people will now be looking to invest as prices decrease."

Catch a falling knife an' put it in your pocket,
hope it doesn't cut off your penis

In Burnie it's clear speculators are clamouring for the exit, and Launceston? Well I'm getting to you when I get my counting hat back on, but Burnie agents are talking of the worst market in a decade, howling that the speculators aren't getting enough incentives to buy. The economy is in the crapper, the speculators who got in before the bubble are sitting on momentous gains - if they can now sell, which isn't as easy as they thought.

To top it off, and yes I should be scalded for watching, but the orange tanned property cougar from Your Money, Your Call, took a call last week from a speculator asking about Tasmanian and she quickly poo-pooed the idea of putting any money near the place.

What are you waiting for? The market will be strong - if you all put your money in it.

Am I convincing enough?

Menu Planner

Sunday - Cookout for my nephew's 2nd birthday
Monday - On my own, undecided
Tuesday - Three Bean Soup and Crusty French Bread. I am going to add ham to the soup.
Wednesday - Chipolte Pork Soft Tacos
Thursday - Wine Club

Friday, 22 October 2010


Announcer: Reports continue to flow from the outer colonies of plastic and wood structures being erected on front lawns. Debate rages in the local communities regarding the how and why, but one consensus has emerged - this isn't good for real estate prices.

Lady stands in front of house.

Lady: I don't know where these signs are coming from, but I want it to stop. I've got one either side of me and the longer they sit here the more I can feel my home value going down and we've only got 10% equity in this thing. We had 15% but we took some out to buy a new boat and BBQ.

As the bad news piles up, much to the chagrin of the real estate industry, who have effectively now lost control of the media, the bubble boys are furiously comparing notes - trying to understand where the epicentre is.

Don't discount Tasmania's ability to punch above its weight. Right now in Tasmania, real estate signs are appearing like the plague cross did in 1400's Europe. Real estate agents are hammering so many signs into front lawns they could actually be considered tradesmen, but given the state of the market they're less likely to put on florescent safety gear and a hard-hat, they're more likely to put on a pair of Depends.

Why? Yesterday, by my humble calculations, the north-west city of Burnie crossed a dubious milestone, a 40% increase in listings. Time frame? Ten months.

Cheap houses, expensive houses, dumps, mansions. All sitting, while the days on market continue to tick over. The real bitch of it? Besides being unable to sell your house, is being a real estate agent in this situation. The vendor has just watched a boom over the last 10 years, where house prices have doubled, trebled, quadrupled and they don't get to participate in it? They don't get to toss their red hot potato on and walk away with untold riches?

That's the reality vendors now face. And agents and their industry have to get through to the house selling public, the very people they've sprayed with UP UP UP propaganda at every opportunity, that things are DOWN DOWN DOWN. That last 8-10 years will become 8-10 years again, not an endless, centuries long boom, that began after the black plague was conquered in the middle ages and stretched to 2010.

Lending figures low, listings high, the smart agents will quickly realise a unsold house equals no commission, adapt, level with the vendor and point out the facts. It's the only way to move a house now, because if prices stay sticky and those listings get worse, the carnage will be untold when vendors all clue in at once.

The bad agents will bitch and moan, ignore the distortion between prices and incomes; ignore the massive private debtload; ignore the amount of houses currently sitting vacant and ignore the investors are cashing out with their profit. The bad agents will then look for scapegoats, like yours truly and anyone else who pointed out the obvious. They still won't be able to hold the jockstrap of this douchebag who attributed the 2007 US slow down in sales to people like Peter Schiff:

The primary cause of the recent (and temporary) slow down in this market, in my opinion, is due to the piling on of media and pundits that must feed the fears of their readers on a daily basis in order to stay in business. Schiff's prediction of a 50 percent decrease in O.C. home values is beyond ridiculous. Despite what Schiff and other fear mongers predict, the law of supply and demand hasn't stopped working and the whole world still wants to live in Orange County.  

As Schiff said, "When everyone in real estate is waiting tables (or in jail) and your neighbours think you are crazy for even considering real estate, then it will be time to buy."

I'll take that as a leading indicator.

Thursday, 21 October 2010

Chicken Enchilada Pasta

This recipe was pretty good. I would make it again. My husband says it takes a second to get used to pasta in a Mexican dish but that didn't really bother me. I used regular tortilla chips instead of the nacho-cheese flavored ones. I also only used two green peppers.

12 oz pkg dried jumbo shell macaroni
3 large green peepers and/or red sweet peppers, chopped.
1.5 cups chopped red onion
1 jalapeno chile pepper, seeded and chopped
2 tbsp vegetable oil
2 cups cooked chicken
16 oz can refried beans
1/2 of a 1.25 oz envelope taco seasoning mix
(2) 10 oz cans of enchilada sauce
8 oz package shredded Mexican style cheese
1 cup sliced green onions
2 cups nacho cheese flavored tortilla chips, crushed
Avocado dip and/or sour cream

1. Preheat oven to 350 degrees. Cook pasta according to package directions, drain.
2. In skillet cook peppers, onion, jalapeno, and 1/4 tsp salt in hot oil over medium heat 5 minutes or until tender. Stir in chicken, beans, seasoning mix, and 1/2 cup enchilada sauce. Cook and stir 5 minutes. Stir in 1/2 cup each of the cheese and green onions.
3. Divide filling among shells. Spread 1 cup of remaining enchilada sauce in 3 quart rectangular baking dish. Arrange shells atop sauce. Drizzle with remaining enchilada sauce.
4. Bake, covered, 30 minutes. Unvocer; sprinkle with remaining cheese. Bake 5 minutes more or until cheese melts. Sprinkle with chips and remaining green onions. Sever with avocado dip and/or sour cream. Makes 8 to 10 servings.

I made the entire casserole and put the other half in the freezer for another week.

Source: Women's Day October 2010 Issue

Wednesday, 20 October 2010

Camille's Room Clean Up

I have started thinking about Christmas and all the new toys that will come into the house. Camille's bedroom is for sleeping but also for playing. The amount of stuff sometimes seems overwhelming...where does it come from? I swear it multiplies overnight. I purchased 3 new drawer bins from Target. They are on-sale for $5.99 each right now. We made three piles just like they do on all those organization for donate, one for attic (saving for my new niece who was born last week) and one for trash.



We made a room for Mimi, Camille's Lovie, in one of her closets.

I purchased reusable food storage containers from the Dollar Tree to help us organize our crafts.

Still a lot of stuff but it feels much better and there is even one empty bin and the Halloween stuff will go back in the attic so there will be more room in Camille's closet for whatever Santa may bring.

Tuesday, 19 October 2010


We aren't even there yet and life is beginning to imitate art. With news again rumbling out of the RBA about potential rising interest rates and credit card debt back scaling the mountain of stupidity, a dude in the Hobart suburb of Moonah has gone all Nancy Botwin, moonlighting as a pot barren to ease his financial distress.

Why? Well for this guy, the brown stuff from the bowels hit the air displacement mechanism when the fixed rate mortgage on a rental property switched from fixed to variable.

It was then, the mild mannered father of three, junior soccer coach and scout volunteer, saw a grow-op as his best chance to get things back on track. As you'd understand, for any average guy who was earning over $100k a year - well it's hard out there for a pimp - when he trying to get money in as rent - SUV and petrol money spent - and bitches like me talking shit.

That's right, brother was earning over $100k a year and still struggled with the payments before he turned hydroponic. I'm being too simplistic, for sure, so investigating Moonah, where the rental property is/was, will probably turn the heat lamp on and light up this situation.

Here's a 3x1 with downstairs flat, and to my man, 'D' from Sydney, who asked what 3x2 means? That's 3 bedrooms x 2 bathrooms. Sorry D, I haven't been counting parking spaces.

The current asking price is $395-425k, after selling eight years ago for $168,000. So the owner, like most every other dill with a ten year limit to their property memory, clearly believes houses double in price every seven years. This, after the growth in the previous eight years was a more subdued 14%.
And here's another 3x1 from the bud bearing suburb of Moonah:

Asking price? Mid $300's, my assumption $340,000 would be nice. Sale eight years back? $120,000.

Moonah pot merchant probably wouldn't have found himself in this situation if he'd bought back in the early part of the decade, like all property investors are happy enough to tell you, "go find a flux capacitor, get back in time and buy a property, you moron." Buy in the last couple of years and your skull is really banging on the ceiling of affordability and growth. How else does a guy on $100k find himself up the spout and growing weed to pay the mortgage? Probably through buying at the worst possible time, in the middle of euphoria, when property can never fall, you can never lose and a new pricing paradigm has been established - albeit until we revert back to the old one again.

Pass the dutchie and maybe we can defy gravity a little bit longer.

Monday, 18 October 2010

Menu Planner

HandsOn Day was a great success! My project was at Maymont Elementary which is now a preschool in the City of Richmond for ages 2-5. All my volunteers were from Target Stores. Over one hundred people helped beautify the school. We painted awesome murals on a trailer, in the nurse's office and on the blacktop. We made flashcards, washed all the windows, planted raised bed gardens and re-landscaped the front yard. It was a gorgeous day and the school looks great. In the haste of leaving the house on Saturday am, I forgot my camera. I am working on getting some pictures emailed to me and I will post.

Glad to be back to blogging. We are organizing Camille's room tomorrow so stay tuned for before and afters of that project.

Menu Planner for the week...Monday - Chicken Enchilada Pasta (I am having a hard time finding a link to this one so if it is good , I will post the recipe later in the week)
Tuesday - Italian Sausage Soup, Blueberry Muffins and Salad
Wednesday - Chicken and Cheese Ravoli, Salad
Thursday - Not sure

Italian Sausage Soup. See below for recipe.

(2) 14.5 oz cans stewed tomatoes, undrained and mashed
4 cups pared and diced potatoes
1 cup chopped celery
2 tablespoons minced celery leaves
(3) 10.75 oz cans of chicken broth
2 cups water
1 cup tomato sauce or juice
1 pound hot Italian link sausage
1 pound mild Italian link sausage
1/2 cup chopped onion
2 tablespoons of sugar
1 tablespoon lemon juice
1 bay leaf
1/2 teaspoon dried thyme
1/4 teaspoon pepper
1/2 cup Parmesan cheese, for topping

Combine first 8 ingredients in large Dutch oven, bring to boil. Reduce heat and cook on low for 45 minutes. While soup is cooking, slice sausage in 1/4 inch circles, do not remove casings. (Note...can also remove casings and break up and brown.) Brown sausage in a large skillet, drain and pour off all but 2 tablespoons pan drippings and saute onion until tender. Drain well. Add sausage and onion to the tomato mixture. Add all remaining ingredients except cheese. Cook covered an additional 45-60 minutes. Serves 8-12 people. I freeze half for later.

Friday, 15 October 2010

Jekyll and Hyde

It’s slightly ironic, as we come to the end of Mental Health week, that the real estate industry is having an anxiety attack and from my remote diagnosis, showing signs of bi-polar disorder.

Yesterday, while the REIT CEO was busy participating in a feature on the North-West of the state, detailing how tough the Tasmanian market was, giving quotes on sales being down 20% and where blame should be apportioned, the newly minted REIT President was at the other end of the state, talking up Tasmania - with higher demand and strong interest from speculators.  

Somebody is off the reservation, or possibly hasn’t even arrived on the reservation yet. Whatever the case, the REIT needs to get their communications in order, maybe a dose of Malcolm Tucker would do the trick. A united front at least gives the appearance, to the less nuanced amongst us, that everything is fine.

It’s clearly not.

The lead for the article was an unfortunate boast – “Sandy Bay is makin’ it rain: Dollar bills for agents y'all!”

Hardly a revelation - the priciest suburb in the state is making fat bank for the agents. We were also treated to the knowledge Devonport is apparently the most affordable market in the state, with a 250k median and 240 homes sold last year.

And based on those figures, how fantastic it is that Devonport currently has a 10 month supply of property above the median of $250,000? Waiting, waiting, waiting.

As the supply side stacks up, with some markets 30% more crowded than they were at the beginning of the year, the game of recycling old listings as new is on in earnest. 

Like Deanne told us yesterday, “when the boom was on…you really didn’t have to do anything.” 

Fantastic, they can now put their skills and knowledge to work. I'm sure real estate agents have long dreamed of the time when they can apply themselves.

Cold calls, mass emails and more recycled listings, here we come.

Down and Out

They used to tell me I was selling a dream, and so I followed the mob,
When there was a home to show, or contracts to sign, I was always there right on the job.
They used to tell me I was selling a dream, with riches and glory ahead,
Why should I be standing in line, just waiting for bread?
Brother, can you spare a dime?

This morning, on the way to work, some guy sporting a bluetooth ear piece and a sharp suit was hassling me for spare change. Confused, I tossed him a coin and thought nothing more of it.

By mid-afternoon I knew what was up and I wanted my coin back.

Apparently there is a real estate Hindenburg going down in Tasmania (who knew), which some real estate agents finally admitted to this morning. You probably already know about this because it was featured on bubblepedia and delusional economics this afternoon. And right now the web nerds at The Advocate are busy scratching their heads, wondering where all those hits came from.

Online, our old buddy, Deanne ' severe shortage' Lamprey, quickly capitulated, admitting "Tasmania's real estate industry is at it's lowest ebb since the economic doldrums of the late 1990's."

Admitting you have a problem is the first step and slightly unexpected for the real estate industry, where everything is fine - until you realise the buyers aren't responding to your "everything is fine" routine any more.  So I ran out and grabbed this souvenir edition, finding it wasn't just one article of woe, it was a two page spread of real estate snuff porn. 

It wasn't long before the game was obvious. If admitting you have a problem is the first step, the next steps for the real estate industry read something like this:

2. Sense an opportunity;
3. Simultaneously cry to government and blame government for woe;
4. ???
5. Profit.

In addition to the Deanne Lamprey story, we heard from Betty Kay who suggested "someone has to take a stand," before detailing the litany of costs that are holding up speculators in their quest to buy a $200,000 rental property - all told, about $9100 on purchase. She also raised the scandalous problem that speculators have have ongoing costs - like rates, land tax and bank interest to pay.

I mean somebody should subsidise these people!

Oh wait...

Such hardships were now having an effect on the mainland sharks who were coming to Tasmania, devouring properties, doing little in maintenance, while reaping huge capital gains as the ponzi scheme grew ever bigger.

Typically, when the river of money runs dry, when there’s not another sucker to be had, it’s never a case of reaching the peak of common sense, as buyers begin to recoil - it now becomes an argument of “someone’s shackling us.” So the real estate industry response is a series of freakazoid suggestions that can push more money into housing - like tapping into superannuation, which was one of Betty Kay's fantastic ideas.

If the market continues to crumble, superannuation will be the next thing the real estate industry will be falling over themselves to get their hands on, you can bet on that. Why not hold your retirement at gun point, to push up house prices and go further into debt? 

"People wouldn't be losing like they did when the share market crash came."

Ah yes, endless rivers of gold, flowing into real estate.  

One glaring oversight across the two pages was the failure of anyone to acknowledge the first home buyer's boost and the effect it's had on this market. You don't make anything cheaper by giving people access to free money, it just means they will spend more. And you've artificially removed buyers from the future, if you're wondering where a certain number of your buyers are, they're already inside their houses - or from what I'm seeing - they're working on a quick turnaround flip before the interest payments send them broke.

The facile arguments continued to add up, mostly attacks on stamp duty, which is one of the lowest in the country, with Ellis suggesting $10,000 to $20,000 was keeping potential buyers out of the market. In the spirit of the great Enzo Raimondo, the REIT CEO, Martin Harris chimed in with similar claims of stamp duty keeping people out of the market.

Conveniently, I have a stamp duty calculator on hand. Even at $550,000 you can't crack $20,000 in stamp duty. Is there any logic to suggest that the guy who can rustle up $550,000 will bench himself over an extra $20k? Not even willing to toss a low ball in a market that agents describe as being at the "lowest ebb" in years? Not even willing to consider the $530,000 house down the road - that just won't do? Which I can calculate the stamp duty on, add to the purchase price and come up with... WHOA! $548,750. 

It's time to wind this unwieldy mess up, but before I go, I pondered how a real estate crash could possible be bad for The Advocate? Local listings are up 30% which equals a big fat Domain lift out, and Sean Ford's articles are generating national page clicks as bubblemaniacs, like me, rush to prove themselves right.

I can only assume we're on again for next Friday, Sean? And if you're getting Deanne back for the next article, could you ask her - were all those investors circling Burnie just prank callers?

Wednesday, 13 October 2010


In the face of continuing rodent infested news for housing, what better time for BIS Shrapnel to come out with one of their housing outlooks, predictions, forecasts, whatever.

One seems to roll out every quarter, under a different guise, reheating essentially the same information. Basically with the job of communicating from the sector, to the naive, through a lazy media, how awesome shit is gonna get.

The equivalent of an agent reassuring you: "you'll never lose in this location."

And if you are naive, or just twelfth man on the deal team, last to know - this one rolled out after being commissioned by QBE LMI. Yes sir, they're a big old issuer of mortgage insurance. Needless to say house prices are going up. So don't delay, buy one for Mum, one for Dad and one for QBE.

In the face of all common sense, you can make 13% in Hobart over the next 3 years, or you could go backwards even further, like some Hobart residences previously featured in this blog.

Which brings me to an anecdotal point of interest. The meager research done for this blog keeps revealing house after house swallowed, then regurgitated back onto the market within 18 months, in fact some, like this 3x1 in Launceston must have a seriously bad case of feng shui, it's barely six months between previous sale and re-listing.

Six months ago it was yours for $314,000. Now you can have it for $389,500. Some may say that's ambitious, but hey, if I'd lived in a house and farted in it every day for six months, I wouldn't dream of selling it to the next guy for less than 75k more than I paid.

That's if I'd ignored all the discounting going on around me.

Someone with a less ambitious bent is offloading this 3x1 in Burnie.

It's going for a dirt cheap $279,000, which is nearly 7x income for Burnie, but August last year it was snapped up for $265,000. Coincidentally, the difference between those two figures is the exact amount of the first home buyers boost in August last year.

The house is also currently listed as a rental. What was that familiar cry in the midst of the first home buyer's boost lunacy?

"Get the grant, live in it for six months, then rent it out! I'm on the property ladder, bitches!"

Just watch that loose rung.

Monday, 11 October 2010


Rotten. That would be the only way to describe the latest ABS housing finance statistics for Tasmania. Sure they're up on last month and you can make statistics dance anyway you choose, if you're so inclined. Yet for the whole of 2010, Tasmanian housing finance commitments have not cracked 1000 in any month.

Well what does that mean?

August and September of 2008, in the midst of the global financial crisis, was the last time figures hit this mark and looked like staying there. And we know what happened next, Rudd and Swan tossed money out into the battlefield and their doe-eyed saleswoman, Tanya Plibersek, sold the cash bribes to the naive and inexperienced first home buyers.

Thanks to that intervention, the figures climbed above 1000 and stayed there until January this year, when the bribe was withdrawn. Since that point Tasmanian housing finance commitments have continued in a bottom bumping trend, under 1000 per month. To put this in perspective, sub-1000 is a figure not consistently seen since the year 2000.

With the cupboard now bare, could any more money could be thrown at housing? Aside from the debt overhang from the last stimulus, the parliament now rests on a knife edge - so doubtful. The average citizen may actually get a real world lesson in housing - it can move in two directions.

Quite a momentous, or let's face it, or rotten day, to list your home for sale at $555,000. Like someone did today with this 3x2 in Burnie:
Now I'm all for ambition, but 14 months ago it sold for $480,000. Given the economic outlook, only a madman could now front $555k and think it is sustainable. Alas, there may be a saviour. A hospital is only a 3 wood away, over the back fence. Maybe a doctor will be stupid enough to outlay such a figure, but would you want that nutty doctor looking after you?

Give it a few months, maybe it will sell, or we can fly south, to Hobart and see what happens when you overpay and can't snag a buyer.

Eight months ago this quaint 4x2 went onto the market at $460,000. Six months and no bids and now the owners will take $400,000. Only problem with that - it last sold for $450,000 in 2007.

What are the odds another discount is being considered? Well let me clue you in - 60k of debt for every man, woman and child; immigration falling; student visas are crashing; our high dollar making us a less attractive destination; listings up 30%; empty listings running at nearly 20%; a new dwelling built for every 1.62 people added to the state population.

Who can save us?

I hear Oprah is on her way.

Sunday, 10 October 2010

Menu Planner

We had a great weekend that involved a trip to the pumpkin patch. As you can see my top planter of pansies are no longer with us and the other two aren't looking too great.

Menu Planner
Sunday - Maple and Soy-Glazed Flank Steak, Mashed Potatoes, Asapargus
Monday - Brown Butter Gnocchi with Spinach and Pine Nuts
Tuesday - Kickin' Chicken with Crunch, Beans & Rice, Corn
Wednesday - Pork Loin with Mango Salsa, Cous Cous
Thursday - Not sure

This weekend is HandsOn Day, a city-wide day of service. If you are looking for a volunteer opportunity, click here to sign up.

Thursday, 7 October 2010


It’s only taken six weeks and I can officially get high on the smell of my own farts. This morning a North-West reader alerted me the local newspaper, The Advocate, had written a story questioning any housing shortage - going so far as to suggest there might be a bunch of empty houses around the state.

I ran out and grabbed the paper, in the process half expecting pig poop to land on my head at any moment. Upon reading the article I found myself as pleasantly surprised as anyone could be in this situation – don’t kid yourself, the weekly Domain real estate lift out is probably the ventilator keeping this newspaper breathing.

Now anyone who’s read this mangy mess of a blog would quickly realise The Advocate story had my fingerprints all over it. After all, it was only last weekend I drove a dagger into the heart of any spruiker cunning enough to suggest the North-West had a shortage of housing.

And a month earlier I suggested Tasmania was currently building a new dwelling for every 1.84 people added to the state’s population. Coincidently, similar information makes its debut in the article, only this time it’s 1.62 people – even worse!  (Different time frames).

Out of the blue, did Sean Ford decide it was time to investigate the shortage myth? I doubt it.

While I may make light, suggesting I’ve had twelve readers in the last six weeks, it’s not quite true.  I see the numbers and they’re building, which must frighten the hell out of determined spruikers and housing goons with a constipated supply of specs jammed up their back passage.   

Do I care about the credit? Do you see a name here; do you see any banners that I’m trying to make a buck off? No, this is nothing but awareness, or if you like consumer advocacy. Think of me as Ralph Nader, and this site as a seatbelt. I’m letting you in on the fact there isn’t any shortage and houses don’t always go to the moon.

The real estate industry despises the idea of a buyer having access to any information. They want the buyer blindfolded, tied to a chair, with electric probes clamped to their genitals, shocking them into submission, before the buyer finally accepts every ludicrous real estate myth peddled.

“Sign me up, here’s all the debt I could muster!”

I suspect Sean Ford knows this, he’s no fool and can see what is happening to his region.

With no hint of irony, his article was jammed between another on further jobs losses and an ad for the closing down sale of a carpet factory.

Keep scaring people into overpriced housing and you put an anchor around their neck, which is completely unproductive and diverts money away from other sectors of the economy – just what you want as the Tasmanian economy falters.

While Sean only saw fit to quote local real estate agents, I won’t hold that against him, he probably knew they’d swing from the highest branch on their own words – do any of those quotes make a sliver of sense?

 Deanne Lamprey of First National expected a more severe shortage was on the way.

Sigh, it’s going to be a long and hard road out of hell.

Feast and Famine

The first thing you need to know about real estate is you have no idea what your house will sell for. When mad drooling cretins, fuelled by debt, fear and delusion start moving in herds, your property might be the scene of growling and teeth gnashing. Several of these cretins may rear up, savaging each other with lashes of a bank's sharpest instrument - a loan approval. And at the end, chests will be puffed out as one side imagines their victory becoming BBQ folklore, while the other consoles themselves with a half-hearted, "it wasn't the house for them."

Which leaves you sitting on a pile of money.

The other scenario is no where near as exciting, there's no victorious party and only one loser. That's you, because no one gives a jack - about you, your house, nor what you think it's worth.

Welcome to the reality of the 4x2 located in Somerset. Five months on the market, one failed auction, long sitting empty and the asking price of $383,000 becomes $289,000. With a phone call, an uninspired agent updates a listing and there disappears $94,000 of assumed equity. 

But is it enough to bring those herds back and get those teeth gnashing?

At over 7 times average local income, there's a little more fat to be trimmed yet.

Monday, 4 October 2010

Menu Planner

I am still taking my blogging break until after HandsOn Day but thought I would post the menu planner since we are still eating this week. Here goes...

Monday - Chicken and White Bean Soup with Herb Swirl served with Blueberry Muffins and salad
Tuesday - Taco Casserole (recipe below)
Wednesday - Kristen's Chicken
Thursday - Zatarain's Jambalaya with Chicken & Turkey Sausage

Taco Casserole
1.5 lbs lean ground beef (I bought ground turkey this time)
1 package taco seasoning
1 (8 oz) can tomato sauce
1 (15 oz) can diced tomatoes
1 (15 oz) can chili or kidney beans
1 cup frozen corn
1+ cup shredded cheddar cheese
1 cup tortilla chips (coarsely crushed)

Preheat oven to 400 degrees. Brown meat and drain. Return meat to skillet and add taco seasoning, tomato sauce, tomatoes, beans and cook until hot. Add corn & simmer 5 minutes to heat through. Put in baking dish. Top with cheese and chips. Put in oven 5 to 10 minutes to melt cheese.

Top with sour cream, sliced green onions, shredded lettuce, cheese and chips.

Nervous Night

Just when you think it can't get any worse... If you're one of the illustrious eight people who read this blog, yes I'm actually growing at the rate of 4 people a month, you may remember this house in Launceston I've previously mentioned:

Last sold for $335,000 in mid 2009. The going price in my post was $325,000, that was after the first discount. It's yours now for $315,000.

With $20,000 already flushed and another $11,000 torched in stamp duty, it's worthwhile asking how far ahead would the renter be in this situation?

Price to rent a similar house, in the same suburb for 14 months? Around $17,000.

Of course I'm presupposing the occupants are still in this house, which they aren't. They're long gone along with a good chunk of any equity they might have had. Be it they had to move on, or were forced to, they left with less than they came with.

We're on the eve of an RBA interest rate decision and thousands now have a nervous night ahead - they're sweating bullets the next rise doesn't push them over the edge - making them a forced seller in a market that isn't nice enough to give them back all they paid with the extra cherry of capital gains on top.

If you have to sell soon - it won't be just rent money that's dead money.

Sunday, 3 October 2010


Well eventually I knew there would come a time I had to do some real work maintaining this blog, I couldn't get by on smart arse comments and poor sub-editing forever - I just needed a hook to get me going.

It came in the most depressing way, as I was informed several people I knew were sitting on a second property - a second empty property - a second empty property they'd renovated and hoped to flip. 'Hoped' being the operative word.

As previously mentioned the, details are too depressing for words and if I went into them I'd probably turn all Glenn Beck as I start blubbering at the prospect of the financial Armageddon these people face.

Putting two and two together I quickly find the properties listed online, pictured dead empty - then something clicks. If you're someone like me - with too much time on his hands and a mild case of undiagnosed asperger's - you notice a few patterns and being the relentless and lifeless fool I am, I decided to follow them.

The result is the following graph:


It shows the percentages of unoccupied and rental properties currently for sale on the North-West coast of Tasmania. It works west to east, Smithton area as the furthest west and Latrobe the furthest east. Burnie and Devonport are the major population centres.

To the veracity of the figures, if a property is listed as a rental - I'm counting it as a rental. I suspect the Devonport figures are not entirely accurate and should be higher, many houses had indicators they'd be rentals, but if it's not explicitly stated I couldn't count them.  The other noteworthy point about the Devonport figures, they bleed into the Latrobe figures. East Devonport, a lower priced area and more likely to targeted by investors was counted with Latrobe.

On the unoccupied dwellings, if a dwelling is pictured empty, just as the aforementioned houses of the flippers were empty, it's saying something - it's currently empty. And if the house hasn't been sold within the last few years, clearly there's no picture recycling going on - the house is empty.

Firstly the consistency of the unoccupied figures is interesting - they didn't exceed a 5% difference across eight markets. With 15-20% being the range of unoccupied houses for sale. From my observation, the unoccupied houses counted basically fell into two categories - low priced potential rental/first home or newly built spec homes.

This flies in the face of the Tasmanian HIA's year on year bleating that Tasmania is 200 homes short a year. I've just found over 250 in one region. Significantly, many were new dwellings, unoccupied, never lived in and waiting for an owner.

If you're in the market for a new house or unit on the north-west coast of Tasmania, you won't have any trouble finding one.

Could it be.... dare I utter the word... oversupply?

Which is extremely concerning - how long can builders hold onto these dwellings before their financial stability is threatened?

The others? Be they rentals without tenants or be they flips, someone, like those builders, is incurring holding costs - without any income at a time when equity is evaporating.

To the rentals, the most obvious point of note is the spike in Burnie rentals for sale. Those figures are entirely accurate and clearly Burnie agents aren't shy in advertising the current use of the property - if you're a buyer, you're a buyer to them. To me the chart looks entirely satisfactory to that point. The Smithton area at the west, is a smaller catchment and probably less attractive to investors. Wynyard and Burnie are 15 minutes away from each other by car, so Wynyard is a perfectly viable alternative to an investor, so clearly flows into Burnie.

So why the Burnie spike? In the early 2000's, rumours long circulated that mainland investors were coming into the north-west, hoovering up cheap properties and renting them out. By cheap, I mean $50k-80k. Now in the last year Burnie has lost over 200 manufacturing jobs, not to mention another around 350 between mining and processing in nearby areas (conceivably a number of these people actually lived in Burnie). And now a black cloud hangs over more jobs at a Burnie cheese factory, as the owner conducts a review.

If you're an investor and you've ridden an investment property from sub $80,000, to over $250,000 in under 10 years, you're pretty lucky - especially when growth like that was completely unheard of in Tasmania. Then what happens when jobs around that property are beginning to disappear? You're probably going to take your luck and jump, like the rat off the sinking ship.

Three investment properties hitting the market, in one day, with the same agent, in the same area - that's no coincidence, that's someone dropping their load.

The rats, aided by cheap credit and tax rorts, floated this boat and everyone else, from the builders, to the flippers, to the first home buyers, thought it was safe and jumped on board. But now there's a leak - jobs are disappearing and as the rats now jump off, they'll probably sink the ship. Unfortunately, everyone else had no idea what kind of market they were operating in. The builders especially, but how could they? This is their own association talking:

While the Tasmanian economy continues to perform reasonably well there are increasing pressures on housing stock as underlying demand continues to exceed the supply of new residential dwellings.

As a state we are building at least 200 new dwellings less than what is required per annum.

Quoting it here saves me searching for it later on Wayback.