Australia's population growth is slowing. This could impact the property cycle

Discussion in 'Property Information Resources & Tools' started by Beelzebub, 12th May, 2016.

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  1. Cactus

    Cactus Well-Known Member

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    I look forward to coming back and telling you how well I did on the development. :rolleyes:
     
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  2. 2FAST4U

    2FAST4U Well-Known Member

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    Median vacant land lot sizes over time.
    upload_2016-5-19_9-21-19.png

    In the last 25 years the typical lot size in Australian capital cities has reduced from 750sqm down to 475sqm. With population growth this is the inevitable.
     
  3. Azazel

    Azazel Well-Known Member

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    But really, we've got a population of just over 20 million.
    There's about that many in NY state, or Mexico City.
     
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  4. pauk

    pauk New Member

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  5. marty998

    marty998 Well-Known Member

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    But that's precisely the problem. I don't want to live in a place as overcrowded and polluted as Mexico City. I don't want to have to sit for 3 hours in traffic everyday in New York City.

    I don't want to have to get on a Sydney train with a 10 million other people in the morning.

    I chose to continue to live in Sydney because up till now, the population has been not to big and not too small. But with all the towers going up and the cranes on every corner, and the push to squeeze everyone into small apartments, this little goldilocks with his 3 hour a day commute is not exactly a happy camper.

    How can quality of life be better when you are squished into a shoebox. I don't buy this crap that people are choosing to live in apartments therefore we should build more of them. People are living in apartments because they have no other choice.

    The strain on the environment and the lack of open space to run free is such a large negative against quality of life.

    If I wanted to live in a place as overcrowded as Taiwan, I'd move to Taiwan.

    (Sorry, didn't mean to rant as much as I did there).
     
  6. Chabs

    Chabs Well-Known Member

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    The reality is you're just 1 person that is part of literally millions that makes up "demand". What the collective demands is: these smaller places near the city. The collective demands location, affordability, convenience. These things correlate with high rise apartments, smaller living areas and urban planning and living.
     
  7. 2FAST4U

    2FAST4U Well-Known Member

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    There seems to be a bit of a backlash against migration recently. The punters are starting to wake up and realise some of the negative externalities of population growth e.g. more traffic, longer commute times, soaring school enrollments, longer waiting lists for public hospitals as well as more competition for jobs and higher land prices.
     
  8. Brickbybrick

    Brickbybrick Well-Known Member

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    Hopefully the Sustainable Australia (or whatever is is they are called) party will get more votes next time around.

    Sure as investors, or potential investors like myself (still searching for the right PPOR:mad:) we want to create wealth for ourselves but one has to look at the big picture too.....
     
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  9. C-mac

    C-mac Well-Known Member

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    I think many nations around the world right now need to have a frank conversation about population size.

    Strip away any notion/mention of immigration from any specific country, and just have an honest, unbiased conversation about what each country's "goldilocks" population size should be, and then work backwards from there. Needs to take in to account rverything mentioned here so far; assessment of resources, overcrowdibg, strain on infrastructure breaking points, and indeed an assessment of what the current pop looks like after the baby boomer death-wave completes. See, natural attrition may see for several countries' populations mass-decline anyway.

    If immigration volume then needs to take a hit as a result, well, so be it.

    Not saying that the alt-right protectionist viewpoints are right (or indeed wrong), but a frank, public-consulted, conversation on ifeal population volume per-country, needs to happen within each country.
     
  10. Ted Varrick

    Ted Varrick Well-Known Member

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    This thread should restart the euthanasia debate, at the very least...
     
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  11. petewargent

    petewargent Buyer's Agent

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    Pauk in 2012:

    "Actually to me the demographic headwinds started some time ago and will only increase now. Savings started to trend up since 2004? And retail sales started to decline in 2003.
    House prices will fall until 2018 when they are close to or at their intrinsic value."
     
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  12. humptydumpty

    humptydumpty Active Member

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    I read Abs stats as per them Australia has net 1 person added every 1.5 minutes. This includes new births , deaths and immigration.
     
  13. highlighter

    highlighter Well-Known Member

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    Population growth has slowed sharply since 2009. We are adding new people, but much more slowly than we were during the boom. Our population growth peaked in 2009 at 2.25%. It hit 1.4% last year and is projected by Goldman and Macquarie to fall to 1.25% by 2018. Note there is always a long lag for ABS data on population. Around 1.2%-1.8% is about our historical average. Our birth rate is a low 1.77 births per woman, and our immigration policy quite honestly can't be much looser than it currently is - in fact it's about as loose as it has ever been (you can quite literally obtain a 457 visa to become a bricklayer, secretary, labourer etc, so we're not restricting immigration to "skilled" workers). So our population growth rate, for the foreseeable future, is very unlikely to climb and if unemployment rises is will fall further.

    According to BIS Shrapnel based on this level of population demand, and on demand from investors, we require 150,000-165,000 dwellings annually. The trouble is, according to Citi this year alone we are building an absolute record high of 230,000, and we've been above 200k for a few years now, so cumulative oversupply is becoming a big problem.

    One significant sign of reduced population demand for housing is falling rental yields, which are sitting at or near a record low. Keep in mind too China has enacted capital controls, and banks are restricting lending, which reduced investment demand. Our final challenge is that our population will invert to an aging population in 2020, which will further reduce our population due to deaths (it will also reduce investment demand as Boomers sell up assets in retirement).
     
    Last edited: 4th Dec, 2016
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  14. Graeme

    Graeme Well-Known Member

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    I was just catching up on the thread today, and I saw this old post.

    The UK has a reputation for having streams of people coming in, and yet the net migration figures for Australia are broadly the same. However, we've got a population of 24 million, versus 64 million over there. So who's bringing in the hordes in search of a better life?

    Immigration was one of the things that drove Brexit, and it's an easy target for populist politicians. About a decade ago the Tory party ran adverts with slogans like "It's not racist to oppose immigration". In June this year, Nigel Farage unveiled this poster.

    [​IMG]

    For that reason, I get a little uncomfortable when Macrobusiness goes off on one about the Population Ponzi. I think that there are arguments against bringing in the numbers that Australia does, but I'm not sure where to draw the line. However, if the government wants to grow the country, it needs to spend more on infrastructure to support this.

    As an aside, The Economist doesn't like the Australian points based system, and published couple of pieces in July (here and here) that argued they depended on central planning by the government, which is never an effective strategy.
     
  15. MTR

    MTR Well-Known Member

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    Peter have posted some recent links, investors should pay attention we are headed for some strong head winds
     
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  16. Ted Varrick

    Ted Varrick Well-Known Member

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  17. WattleIdo

    WattleIdo midas touch

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    Exactly.
    More integration is required which means slowing it down a bit and more infrastructure. It is not racist to want to slow things down and to reduce the ghetto effect.
    In my line of work, I'm largely reliant on immigration and I love working with, learning from and being with people from other countries especially if they love Australia enough to want to move here. I certainly don't want to stop new people moving here.
    But I would like to slow it down until we are able to cope with it. We need more trains, more space, better education about garbage and waste, fewer and smaller ghettos, less fear about speaking up.
    Most Australians bend over backwards to not be and not appear to be racist. Mostly this is genuine but a lot of the time, it's fear of being labelled. Unfortunately, somewhere along the line, we've become precious. It's the immigrants themselves who are least afraid to speak up in saying they don't want the quality of life diminished.
    Of course property investors and developers want massive immigration - on one level, so do I!
    What would be preferable, though, is to see the infrastructure and rewards which will get more people out of the cities and into the regions where it is vital to assimilate.
     
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  18. Kangabanga

    Kangabanga Well-Known Member

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  19. pauk

    pauk New Member

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    Yes I was wrong on house prices. Agreed.
     
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  20. Shaq_01

    Shaq_01 Active Member

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    Some interesting points raised from both perspectives

    Personally I am for the idea for bigger Australia and see far more benefits when compared to the costs

    Much of the costs argued so far are as a result of poor government policy, management and inefficiency

    Once the policy management aspect is refined and made more efficient - the costs will diminish and benefits increase

    However their will always be a cost .. the real issue is will the costs outweigh the benefits or vice versa

    At this point I still think currently the benefits outweigh the costs but we are getting close to a tipping point hence we need to look at efficiency
     
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