If you’re looking for a good laugh to start off the working week, you’d be hard pressed to go past the latest Property report released today by BIS Shrapnel.
According to BIS Shrapnel, real estate prices across Australia are tipped to increase by as much as 20% by 2012.
As reported by news.com.au, BIS Shrapnel’s Angie Zigomanis said activity in the lower end of the market – buoyed by the boost to the first home owners grant and low interest rates – were generating “green shoots” of recovery.
The report says average house prices in most capital cities will grow by between 11 and 19 per cent over the next three years. In real terms (where prices are adjusted for inflation) the level of percentage growth is about half.
Mr Zigomanis, who said actual prices were more indicative than prices adjusted for inflation, predicts the boost to the first home owners grant combined with low interest rates would kick start further activity in the “upgrading” market.
“Kick start further activity in the ‘upgrading’ market?” Really? Based on what exactly? A flight of fancy?
According to BIS Shrapnel, we can expect:
Sydney – Total price growth forecast at 19 per cent to 2012
Melbourne – Nearly 20 per cent increase in prices to 2012
Brisbane – House prices to rise by 16 per cent to 2012
Gold Coast and Sunshine Coast – Expected to grow by 14 per cent to 2011
Adelaide – Tipped to jump 19 per cent to 2012
Perth – House prices to increase by 12 per cent to 2012
Hobart – To jump 15 per cent in the next three years to 2012.
Darwin – To grow by 11 per cent in three years to 2012
To the unititiated, this report would perhaps be the catalyst to “get in quick” before the property boom begins, but the catch cry to “BUY NOW” is beginning to sound all too familiar.
For one thing, it is widely accepted that the FHOG has artificially maintained current property prices at the low-to-mid range of the market. So, on what basis does BIS Shrapnel base their prediction that property prices are going to continue to rise after the FHOG expires?
An environment of rising interest rates and escalating unemployment are hardly factors that would contribute to a real estate property boom.
So what has led to this bizarre prediction? Well, funnily enough BIS Shrapnel’s report has been based on data from the Real Estate Institute – an organisation that has the following mission statement:
“The Institute continues to identify, formulate, encourage and promote public policies that contribute to an economic and political environment favourable to the real estate industry, and small business generally. ”
So not only does this call into question the integrity of the data supplied by the Real Estate Institute to BIS Shrapnel, the fact that the institute is fundamentally concerned with lining the pockets of real estate agents should be ringing alarm bells everywhere.
But not so, the mainstream press just regurgitate the BIS Shrapnel media release without giving it a moment’s worth of critical analysis.
It also makes you wonder about the ethical standards at BIS Shrapnel. But then they did get paid by the Real Estate Institute to write the report, so perhaps in their minds, that’s all that really matters.
A satisfied client.
An invoice paid.
The so called report’s “findings” plastered everywhere in the media.
It would be sickening, if for the fact that it’s all so mind-numbingly predictable.