Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written, yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Wednesday, 12 April 2017

Bear

Bear market

Commonwealth Bank reported that the spot price of coking coal has doubled from $150/tonne to over $300/tonne over the last fortnight. 

Clearly that's related to the disruption to supply caused by Queensland's Cyclone Debbie as repairs are carried out.

More fundamentally, the stimulus from China looks to be wearing off, and it appears likely that the sizeable rebound in Australia's commodity price is set to reverse. 

Earlier this month the Reserve Bank reported that Australia's Index of Commodity Prices had risen by more than 50 per cent year-on-year

However, iron ore spot prices have now dropped by 20 per cent since the third week of March, and as such are entering a bear market.


Resources struggle

SQM Research released its Weekly Asking Prices Index figures for Australia's housing markets yesterday.

They reported ongoing increases in Sydney, Melbourne, and Hobart, but no let-up in house price declines in Perth or Darwin.

In Perth the median asking price for houses is now 12.8 per cent lower over the last three years.


Source: SQM Research

In Darwin, where the housing market has followed a very similar trajectory, the equivalent figure is a 14.7 per cent decline.


Source: SQM Research

These are material declines for capital city housing markets, but are chump change compared to what's been playing in out in some of the regional resources towns and cities.

In Gladstone median asking rents have collapsed by about 45 to 55 per cent over the past three years alone for houses and apartments respectively.

Similar outcomes have been seen in any number of locations, from Whyalla and Roxby Downs in South Australia, to Karratha and Port Hedland in Western Australia, and Moranbah and Dsyart in Queensland. 

As such, mortgage delinquency rates appear very likely to continue rising in resources regions.