Squiz Today – Tuesday, 4 April

A PLACE TO CALL HOME

THE SQUIZ
New research out yesterday shows continuing strong house value growth, up 1.4% in March. That takes annual price growth across the capital cities to a seven-year high of 12.9%. Results are a bit patchy: Sydney’s home prices are up 19% over the last year, and Perth and Darwin prices are currently going backwards. So is this a bubble? In the last few days regulators have moved to restrain what some consider to be at the ‘risky' end of lending. The prudential regulator APRA (they licence the banks) imposed new conditions to limit interest-only loans favoured by investors. And ASIC (the regulator for market integrity and consumer protection) will step up surveillance, they’re looking out for lenders inappropriately promoting interest-only loans.

HOW DID WE GET HERE?
Just how exposed Australia’s housing market is to a crash is something that’s been kicked around for years. Defiantly, the market just seems to steam ahead for most capital cities. However, there’s something about the current environment that has the regulators, governments and the experts a bit nervous. We have high property prices, record high levels of personal debt, low wages growth, and low interest rates. Given all that, the regulators have responded with some measures designed to dampen investor activity. Will it fail-proof the market? Well, no market is fail-proof. But on these changes, some say the conditions are too onerous, others say it will not make much difference at all.

SHOULD I BUY THAT MILLION DOLLAR PROPERTY NEXT WEEKEND?
You’re asking us? We’re a free news email service, not a financial adviser. If you saw our shoe cupboard you would know we have questionable financial/life skills. So here’s some facts: The Australian Bureau of Statistics says since 2015 housing values have increased some $650 billion while debt has increased by almost $250 billion. It’s an indicator that overall housing values would have to crash spectacularly for Armageddon. That, of course, doesn't mean there aren't pockets of vulnerability. Many are concerned about an oversupply of new apartments in some capital cities for example. It will also be interesting to hear what the Reserve Bank has to say about it all after their meeting today. Do your homework and good luck at your next auction…

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SQUIZ THE REST

ST PETERSBURG METRO BLAST KILLS 10
An explosion between two metro stations in St Petersburg, Russia has ripped a large hole in the side of a train killing at least ten people and injuring more than 30. The device was planted in one of the cars of the train. Another shrapnel-filled device was found at another station and authorities were able to disarm it. Russia's Investigative Committee said terrorists are likely to be responsible for the attack. All metro stations and the airport were shut down.

UPDATE ON FLOOD DISASTERS
Tragedy struck yesterday in Tumbulgum (pron Tum-bowl-gum) with three people (expected to be a mum and two children) killed when their car left a flooded road and became submerged. Police and emergency services will mount a recovery operation today. A nine-year-old girl was able to get out and survived.

PM Malcolm Turnbull and NSW Premier Gladys Berejiklian visited Lismore yesterday to see the damage to the CBD area first hand. Business owners spoke to them about getting access to grants similar to those available to homeowners. Under the government's disaster relief provisions, businesses can only access low-interest loans. The expectation is businesses have flood insurance, but many say that policies are unaffordable.

Further north in Rockhampton, the expected peak won’t be as high as originally thought, but it’s still expected to inundate hundreds of homes and businesses by mid-week.

SHOPPERS STAYED HOME IN FEBRUARY
The ABS yesterday released retail sales data for February showing sales were down 0.1%. There were fewer new outfits on show (clothing sales were down 2.5%), and we seemed to have eased up on the takeaways (down 1.1%). Experts put the clothing sales dip down to hot weather in February putting shoppers off new season Autumn/Winter stock, they expect the cooler weather in March will show a pick up in sales. We take that as a green light to get that new pair of boots we like (refer to shoe issue mentioned earlier).

THE HANSON FACTOR
One Nation leader Pauline Hanson refused to be interviewed by ABC's Four Corners program, but former staff, party executives and candidates lined up to tell their stories of woe. What did we learn? There are question marks over the disclosure of significant donations, including a small plane piloted by her divisive chief of staff James Ashby to get Hanson around; concerns over an arrangement where candidates are required to use printing services owned by Ashby at inflated prices; and the ‘people burning’ ways of the party’s leader. Watch out for official enquiries on the donations front in coming days. 

AUSTRALIA NOT ALLOWED TO LEAVE THE TABLE UNTIL IT EATS ITS VEGES
Australia’s premier scientific body, the CSIRO, yesterday released a mega-survey on the fruit and vegetable intake of Australians. And it seems we’ve been very naughty. The dietary guidelines recommend daily consumption of two units of fruit and five units of vegetables. About 24% of women are doing that, and just 15% of men. We’re particularly vege-phobic, and the CSIRO says the key to getting five serves day is to have three kinds of vegetables with our main meal. So that’s chips, wedges and mash, right?

SQUIZ THE DAY

Reserve Bank board meeting, following that Governor Philip Lowe will speak at their dinner

ABS data releases - International Trade; Causes of Death 

Anniversary of Martin Luther King Jnr's shooting death in 1968