Unsafe as houses

Having done my bit to fan the flames of anti-Australian hysteria, props are due to the paper for this morning’s typically excellent piece by George Megalogenis on regional variations in housing price movements. Crucially, a “two-speed housing market” is identified in New South Wales, promising to hit the Coalition hard in marginal suburban and hinterland electorates (specifically Parramatta, Lindsay, Dobell, Robertson and all-important Bennelong), while delivering worthless dividends in the rich inner suburbs (where double-digit swings to the Coalition were recorded in the March state election). There’s a particularly handy cut-out-and-keep graphic listing the 20 electorates where prices have moved most heavily either way, the “price rises” list being monopolised by Western Australia. This ties in nicely with localised polling showing the Coalition collapsing in NSW, while holding ground or better in WA. Also instructive are Possum Comitatus‘s renowned observations on the ratio of interest payments to disposable income. Further analysis of Megalogenis’s data from Simon Jackman.

Author: William Bowe

William Bowe is a Perth-based election analyst and occasional teacher of political science. His blog, The Poll Bludger, has existed in one form or another since 2004, and is one of the most heavily trafficked websites on Australian politics.

344 comments on “Unsafe as houses”

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  1. William hate to be first with a question, but can you remind me of the polling that shows WA polling worse than the last election … most polling that I am aware of over the last 6 months shows a small swing, but still significant enough to claim back Stirling and Hasluck, with local feeling seeming to think Hasluck an easier pickup and maybe Stirling line-ball.

  2. It’s not just a two speed housing market.
    Australia has been divided into two – the have-nots and the have-yachts.
    This so-called boom has been good only for those who already have shares, significant superannuation, more than one property or a job as CEO or equivalent.
    The Indian boom likewise is leaving hundreds of millions still destitute.
    Australia used to be egalitarian. It is no longer.
    The figures are available to show how incomes for those on average or lower than average incomes have fallen behind the cost of living.
    Inflation has been disguised by Chinese imports. They have been exporting deflation.
    The real inflation figure is more like 6%, or worse for some.
    The lower the income the worse the inflation as poorer people don’t buy as many imported Chinese gadgets.
    JWH’s massive immigration programme is putting significant pressure on housing availability. Rents will rise to unheard of levels.
    What the people are realising is that JWH and Costello’s hard line American-style free enterprise policies are about giving more power to big business and restraining wages growth.
    The proportion of the GDP going to company profits is rising steeply and the proportion going to wages is dropping.
    That precisely what AWAs are all about and now the penny has dropped.
    It’s the old old story, the rich are getting very much richer and the poor are slipping behind.
    Kevin Rudd is out there evidently listening to people in the shopping malls, streets and small businesses hearing this story.
    Peter the Pusillanimous and John Howard keep harping on about the economy seemingly oblivious to the negative effect of their policies on working families.

  3. Richard
    I posted on this at ozpolitics 3-4 months ago
    people are hurting and the concept of economic Serfdom is becoming more and more real for many
    I suffered ridicule for suggesting a Lab return of approx 110 seats but even back in march many ordinary aussies were suffering.
    The born to rule set poo-pooed my rants but believe me the 50% primary is now well and truly rusted on and just waiting to send this rabble to oblivion.

  4. Resurrecting ozpolitics posts 🙂 … statistics don’t vote, individuals do. Howard can bang on as much as he likes about how well the economy is going but the misser-outerers are only going to be more and more aggravated by such talk the more they hear it.

  5. You are right of course William, and it wasn’t a sarcastic question it was genuine, I think I was a bit guilty of westpoll dismissal, which I should not. Thank you kindly sir.

  6. Ryan (from last stream William put on vacation -rightly so) was the only QLD seat to vote for Federalism ? Ah, thank you Adam, there is hope yet for Ryan to change hands.

    Is Westpoll the only ‘reliable’ information we have to chew on regarding voters thoughts in WA ?

    The way things are going at the moment Im not as concerned about waiting for votes to fly across the rabbit fence to get a result as i might have been but WA remains the most unknown factor for me and most here I suspect.

  7. On the housing affordability issue, people use their own statistics and research to back the story they want to tell, as witnessed on the breakfast TV shows yesterday morning.

    One claimed housing affordability was the best it has been in ages whilst the other claimed young people are committing more of their income to mortgages and taking more years of full time income to pay off the mortgage and fill their homes with new furnishings instead of 2nd hand stuff-ie want it all ‘new’ now.

    The perception Im getting (very subjective of course) and remembering ‘politics is perception’ is that there are alot more people coming into Centrelink complaining about the struggle to make ends meet in the last year or 2 than ever before in the experience of people who have been working there since the old CES/ Social Security days.

    The punters are hurting, or should I say enough of the punters are hurting to bring about a change in Government. Whether such a change will do those hurting punters any favours is another question altogether- I get the sense though that enough had had enough of this Government in QLD at least to say bye bye to JWH and Peter Costello.

  8. Again on the young voter them, a well respected sociologist in Melbourne (Dr Judith Bessant) theorised a decade ago about a developing young adult mob subject to ‘dependultcy’.. those forced to live with their parents well into their mid twenties because of the inaffordablity of mortgages and rental accommodation. Perhaps we are now seeing the political backlash of that development.

  9. As I commented on the news site, many people are complaining about house prices going up, and now some are complaining about them going down. A change in house price is good or bad depending on whether it’s the house you’ve got or the one you’d like to buy.

    Also, could the house prices dropping in some districts be due to redistribution? For instance, Bennelong shifting a bit westwards, losing a bit of wealthy north shore, and Parramatta moving ‘outwards’ through Sydney.

  10. Speaking of localised polling, the AC Nielsen showed the coalition ahead in QLD 52-48.

    I think this is a small sample aberration, however it’s still down on the last election.

    How many seats would fall to labor in QLD if the coalition got 52% 2PP ? They got 54% (I think) last time ?

    ps: good work on killing the last thread.

  11. Another rate increase, caused by the economy overheating, would cause another drop in house prices in disadvantaged areas and probably have little effect in wealthy suburbs as there is still a shortage of housing.
    Eventually, of course, unless the housing backlog is addressed very quickly, house prices will go back up again even in areas where they are currently dropping. The really big problem is rent increases. Investors won’t buy properties for a 3-4% return with little hope of significant capital gain in the near future. Right now the stock market is a better bet. They can buy fully franked shares with a better return and hope of capital gain.
    They can even get a better return on cash. They’ll get an even better return if interest rates rise. People who are renting now had better try for a long term lease. You can get these in Europe but are not common here.
    House prices are simply a matter of supply and demand coupled with people’s ability to pay. The demand is being fuelled by immigration.
    Immigration is being fuelled to a certain extent by the need for skills.
    That’s where upskilling of the existing population is so vital to reduce the need for immigration.
    Gusface, you were quite right 3-4 months ago. You can’t fool the people with talk of how the economy is going gangbusters when so many people are having difficulty paying bills and the mortgage or rent. And it’s going to get worse not better.
    Inequality has skewed the economy and this is what the conservatives are all about.

  12. “How many seats would fall to labor in QLD if the coalition got 52% 2PP ? They got 54% (I think) last time ?”

    57/43 statewide, so that would be a 5% swing.

    On that basis, Bonner (which will fall if the electorate sneezes) and Moreton would be picked up by the ALP but they’d fall just short in Blair.

  13. “Brisbane also did.”

    15th highest in the country (out of the 42 returning yes).

    Of course Qld wasn’t the only intransigent state: only 1/14 WA and 1/5 Tasmanian electorates voted yes. SA was streets ahead with a whopping 3/12…

  14. 52-48 in AC Nielsen for QLD would mean 2 maybe 3 seats for Labor. Unless seats like Hughes went for Labor it would mean Rodent Triumphant.

    It’s stay the course time for the Libs. If they dumped Howard now it would appear like they wet themselves.

  15. “52-48 in AC Nielsen for QLD would mean 2 maybe 3 seats for Labor. Unless seats like Hughes went for Labor it would mean Rodent Triumphant.”

    No, as pointed out 52-48 in Qld would be a statewide swing of 5%. If this swing was uniform across the country then 2 seats would fall in Qld, Vic SA, WA and Tas, 6 in NSW and 1 in the NT giving an ALP government.

  16. I agree with the last statement though. It’s too late to dump Howard. At this point that would be flying the white flag and, I suspect cause the last of any wavering marginal voters to abandon the coalition.

  17. The Republic Referendum was an interesting insight into Australian Demographics.

    Have a look at the alliances:

    Working Class Labor/Outer Suburban Libs/Nationals
    Latte Labor/Doctor’s Wives/White Collar Liberals/Greens.

    Think of it as:

    Today Tonight/A Current Affair
    The 7:30 Report

    It never had a chance – compare the TV ratings.

    These groups often vote against each other but when the Repbulic Referendum came they showed their true colours.

  18. “Have a look at the alliances:

    Working Class Labor/Outer Suburban Libs/Nationals
    Latte Labor/Doctor’s Wives/White Collar Liberals/Greens.

    Think of it as:

    Today Tonight/A Current Affair
    The 7:30 Report”

    Although there is some merit in what you say, you are obscuring the ‘alliance’ between committed monarchists and direct electionist republicans which was a significant factor in the defeat, which is more like A Country Practics & Neighbours v Home and Away…

  19. Martin B

    Cant see a 5% swing in WA based on the polling though – take them out and you only get 15 seats although including Bennelong. You could get a 2 seat Liberal majority with Costello as PM on those figures!

    ALP cannot win without a massive swing in QLD! End of story.

  20. “Cant see a 5% swing in WA based on the polling though”

    What a curious thing to say. Last election WA was 44.6/55.4 for the coalition. Thus a 5% swing in WA would be 50/50.

    Now do you remember what the last Newspoll analysis showed?

    But of course to pick up Stirling and Hasluck, the ALP doesn’t need the full 5% in WA, they only need just over 2% ie a uniform statewide result of 47/53.

    So, despite what you may or may not wish to see, current polling shows the ALP well on track to pick up 2 seats.

    Now ofcourse a lot could happen, swings are never uniform etc etc. But if you want to talk *on the basis of the polling* then your statement is simply incorrect.

  21. But let’s humour Ed.

    No gains in WA;
    5% swing (only) in Qld;
    Howard holds Bennelong; and for good measure
    No change in Vic.

    Then what uniform swing elsewhere would be needed to pick up 16 seats?

    Answer: 5.5% to get Dobell, Boothby and Page instead of Stirling, Hasluck and Bennelong.

  22. Yes, had a look at that – nice. Although it’s only useful for uniform national swings rather than trying to make different assumptions in different states.

    As you note, one of the interesting things is the gap between a 3% swing and a 5% swing. With 3% – which seems like nothing based on current polling, even in WA – the ALP pick up 13 seats leaving the slimmest of majorities for the government. But to push them over the edge, they need that extra 2%.

  23. Edward, it was a very small sample in Qld; the Newspoll analysis had Labor ahead 54-46 in Qld. Newspoll had Labor up 61-37 in NSW and AC Nielson 63-37 on a somewhat larger sample; these numbers would be an annihilation in NSW. No party has won govt since WWII without a majority of NSW seats.

  24. Talkback on Virginia Trioli’s Morning Show on ABC Local Radio 702 Sydney today was the victim of a concerted campaign from a bunch callers who were, as increasingly became clear, political party plants.

    All male with suitably deep voices and an avuncular tone they were initially reading scripts supportive of Howard and the Coalition but later a couple of these callers were pro ALP.

    Trioli must have had an inexprienced producer who wasn’t filtering properly as she was clearly irritated by these calls which were delivered as speeches without a umm or err or even a proper pause. Trioli like the rest of the ABC is so spooked about being fair and balanaced she did not interrupt these calls but to be fair to her the scripts were so slick and well delivered that she didn’t really didn’t get an opportunity.

    Right at the end what I would hope was a genuine caller got through and pointed out the obvious and Trioli readily agreed that she had been love bombed by partisans as it were.

  25. What exactly is the housing crisis? People aren’t living on the streets or in shelters are they? It’s that a large and increasing section of society cannot afford to buy. This is caused by demand for housing increasing as baby-boomers park their capital in rental properties.

    So enough houses, too much demand. That’s how I see it, please correct me if I’m wrong.

    So if the govt releases more land for housing what will happen? Let’s assume houses are built on the land and renters move in.

    Result a sudden drop in demand for rentals. Over-extended investors start selling, resulting in a price crash. Lots of investors left with mortgages against a weakening asset. Now the battlers are happy, but the investors are mad.

    But the developers probably already know this, so would they start building on the newly-released land knowing the result would be a market crash?

    Again correct me if I’m wrong, but the problem is too much demand. Any move by the govt to reduce demand will reduce house prices. How popular is that going to be at the ballot box? Caroline Overington may believe that greed is good http://blogs.theaustralian.news.com.au/coverington/index.php/theaustralian/comments/why_greed_can_be_good/
    but I wonder how the battlers feel?

  26. Also, re Ryan, it is considered a safe liberal seat needing about 10% to fall, but the sitting member is Michael Johnston who is being investigated by the AEC at the moment. My parents-in-law live in Ryan. Solid lib supporters in their seventies. My wife was surprised to hear her father say that it’s time to change government, and Howard has been in too long. They don’t hate him, I think they admire him. It’s just that he’s been in too long.

  27. A closer look at where house prices have fallen shows that the all of the biggest falls (with the exception of Lingiari) have occurred in the south western suburbs of Sydney. Seats such Watson, Blaxland, Banks are where Sydney’s most socially marginalised are now congregated (particularly the Lebanese Muslim community). Some years ago, there were articles showing that these areas were undergoing middle class flight (what the americans have called ‘white flight’- but in the SW Sydney case included Indians and Chinese) which is a reasonably new phenomenon in this country. It would be interesting to know what political values are also fleeing and what may / may not occur in these residents new homes.

  28. “Since he gives each individual seat, its marvelously easy to just go through the list of seats and see how any swing in any state impacts on each state in terms of seats.”

    Such as I’ve been doing above 🙂

  29. Consideration of purely party political business certainly goes beyond the guidelines for cabinet business as laid down in the Cabinet Handbook, and certainly there is a moral argument against the expenditure of public funds on such. But I don’t think there is any legislative restrictions on such behaviour. (Correct me if I’m wrong.)

    But its entirely up to the government of the day and particularly the PM to decide on the format of Cabinet meetings. It’s pretty low-level and common form of abuse…

  30. Hi. Walter Cronkite here. I think the polls are incorrect and John Howard will win the election.

    NOTE: I don’t think it’s really him – PB

  31. I hate to burst your bubble Lord D but Berowra will still be Liberal after the election as will Warringah (Ed St John seniors old seat)

  32. Nevertheless, it is interesting to note where the “Republican Liberals” live, who I think are also the “doctors wives” and the “Petro Georgiou Liberals”

    Liberal-held seats which voted for the Republic, showing Yes vote

    Bradfield 55.6
    Bennelong 54.6
    Berowra 51.7

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