Beoz

Come to Sydney

Zen10

A "significant" correction in any market requires a drop of at least 10%. I'm not following Perth house prices, but I know the median house sale price in Perth for May 2013 was $540,000. I also know the median house sale price in Perth for January 2010 (the closest to your 2009 date) was $520,000. I make this a 4% increase in house prices from 2009 - 2013.

4% increase is not 10% decrease, I'm sure you will agree. Let's face it, house prices in Australia, and especially Perth, are still climbing, and are in fact totally out of control like the UK market ten years ago.

swans

Still the same question,how would they be able to reduce prices by having fewer customers.

With a touch of further thought if tesco,wal mart came here prices would reduce because of competition,or the greater economies of scale,that these much larger companies have.I don't think prices would change at all.I meet company heads at AGM's.Do you think they run the rule over various countries to try to expand their operations,or do you think they repeat what the crowd repeats and always say'this one piece of information proves everything I have ever wanted to see..

The obvious would be, would they not be be here if there were huge profits to be made in Oz because of the lack of competition.Directors are in breach of their duties if they do not do the best for their respective companies.Would they not do what I did,work out that margins are slim,work out that with millions of customers $1 less per customer means millions of dollars of lost revenue.

Tell me, wal mart make $17 billion in net profit because of competition,or because they have a shit load of customers.If they had fewer customers would they be able to reduce prices,always the same question,always never an answer.

Once in a while I run the rule over tesco,I,m a shareholder in Wal mart.Tesco got their arses kicked in the USA and left after losing around $1 billion( or was it quid).The reason given was they could not see themselves reaching the economies of scale needed to reduce prices,they would lose money for a long time.

To point out the obvious,they would have the same problem here.Woolies/coles have been around roughly for 85yrs and 100yrs,a long time to reach what they have now.I don't know how much it would cost to replicate what they have but shall we say $50 billion in a short time,or much more than that in the long term.Where would they raise this money with a business plan of 'selling things cheaper than woolies and making less profit than woolies do'.Do you think they would be laughed at.Would the pointy heads think that was a great business plan.Would the 144a bond market in the USA laugh at them,would the banks laugh at them.I think so.

Woolies are going through the same thing now(Masters).How long do you think they will sustain losses in the hope of matching Bunnings.Where would Wal Mart find land to build,they have a large land bank in the USA,they have nothing here.

Even more obvious,look at the annual reports of each company.I have not looked in a while but around 3.9% net profit for woolies,and around 3.4% for Wal mart.Could that be explained by the corporate tax rates in each country,find out what they are.

Ford are leaving OZ,how much do you see car prices rising by.In the UK how much did you see car prices rise with the demise of Austin,triumph,humber,hillman,morris etc etc,weird how car prices fell, due to lack of competition and greater economies of scale perhaps?

geordie downunder.

EvannTel

I'm sure your figures are correct but I did say some sectors, not the whole market. The bottom end, the majority hasn't significantly changed but the upper levels have collapsed being even more unaffordable. The suburb where is of was down 25% at the time and I, like most there, are. The sub $1m bracket. This slowing in the top levels ultimately pushes the markets down.
It's about two speeds again.
The reality for a lot of Perth sellers of late has been some misery. And as you say somehow the figures suggest otherwise. I am ally cynical though of REIWA reporting as head ave vested interest.
I think we're are actually on roughly the same page, it's simply the magnitude and severity of an correction we disagree upon.

teza

Actually was talking to a total stranger at Coles last week, in her mid 60's, she'd moved from Sydney 6 mths ago to WA. She could not get over how much more groceries were in wa compared to Sydney (had lived in Sydney last 40+ yrs). During convo she also mentioned that she had never listened when people had warned her of COL in WA, she now regretted it, she was close to tears, as she explained hubby wanted to retire near his kids (FIFO workers) and she'd thought nothing could be more expensive than Sydney....

Beoz

Sydney property I was referring to. Especially that under 1.5 mil has seen only increases .... no decreases. Anyhow ..... yes well aware of the Perth COL for food and the like. I laugh everytime I buy a beer or a meal in Perth. Thankfully its always a paid for expense.