Online Surveys

Whether it is what is the most liveable place or which suburb has the best whatever, the digital world has encouraged many to poll almost everything.

And as the Hot Chocolate 1978 hit goes, Everyone’s a winner, baby.

But these polls do lie!

It pays to remember when you see the results of an online survey or poll, or when you participate in one, that:

1. All open access online surveys are essentially inaccurate, because the group that takes the time to answer the questions is usually quite different from the general public.  The respondents to such polling are even quite different from the intended target audience, despite what the Facebook algorithm says.

2. Don’t confuse a survey or poll with a census.  A survey asks a randomised group some questions and then seeks to extent the answers to an entire audience as a whole.  A census, in contrast, seeks to ask everyone in the audience.

Now you don’t need to undertake a census, what you need is to survey an appropriate representational group.  That takes time and much effort to amalgamate.  The Matusik Missive subscribers are, proudly, an example.

3. Most online surveys or polls are what is called a ‘push poll’.  The actual question asked and especially the way that it worded often changes the way the respondent feels and hence how they reply.

Two ways 

Moving forward there are two ways to best figure out how people feel or what they think.  These are, in my experience:

1. Undertake a focus-group workshop.  Time must be taken to get the right people in the room.  You are gathering people together to watch what they do when given a choice.

Also, it often works best to introduce the key topic to help start the discussion and sit back and observe without any further interference. This is what Australia’s grandfather of market research – Hugh Mackay – does.

2. Undertake an open-reply survey.  Again, time needs to be taken to make sure you send this poll to the right people.  You ask them for a few details and ask them to reply – however they like – to your key question/s.

In both cases you get to see what is said (or written) when and with what amount of conviction.  You also get to see, and read, what isn’t said, which is also very telling.

PS Thanks to Seth Godin for some key thoughts here.

First home buyers

Lots of absolute toss is written about the first home buyer in Australia.

And the commentary varies in the extreme – from how active they are; to how lazy they seem and that they want everything on a silver platter.

And now the Federal government has unveiled their scheme to help up to 10,000 first home buyers on low and middle incomes enter the market each year from January 2020.


I have enclosed two charts and a table in this post that I reckon sums up the real state of play when it comes to buying your first home down under.

Top 5 reasons why early adults move back home

Reason Percentage
1. Trying to save money 50%
2. Convenient to my/our current needs 25%
3. Happy to live at home 21%
4. Want to move out but can’t afford it 20%
5. My job isn’t secure enough to leave 20%
Matusik + AHURI.  Age group 25 to 34 years.  Multiple answers given.  2019 Survey.

These charts and table are something we shouldn’t be proud of.

In most places, today, more money is lent to investors than first home owners. Western Australia and Northern Territory are the two current exceptions.  When I started in this business it was rare than investment loan totals exceeded that lent to first home buyers. Something is wrong here if you ask me.

The FHOG and FHOB was great politics but shit house policy.  Ditto to the current proposed scheme.  They inflate prices, distort the building cycle and have helped reduce – dramatically – the proportion of first home buyers.

Many young adults are now stuck at home.  Burdens all round.

Those of us – with children in the 20s and 30s – should really hang our head in shame.  My bad too!

For the most part, we will leave our children (and probably our grandchildren too) worse off, economically, than we are.

We are the first generation, in over 200 years in this country, to achieve such a feat.

Little wonder why they the younger generation are starting protest?

Big changes are coming.  Are you ready?

I will leave you with this Confucius truism.

The strength of a nation derives from the integrity of the home.

Property Clock Update

Comrades have been asking me to update my property clock.

So here it is.  It covers the new dwelling market, as I really don’t spend that much time in the established marketplace and so I have focused my attention on new digs.

My guidelines

I use these guidelines to help me position each market.

  1. Current housing market: the interplay between, and direction of, sales volumes and stock listed for sale.
  2. New housing market: underlying need to build more dwellings compared to the likely number of new dwelling completions over the next two or three years.
  3. Rental market: change in annual weekly rents versus vacancy rate trend lines.
  4. Coal face:are properties (that are correctly priced and well marketed) regularly selling faster than they would a year or so ago?
  5. Affordable:is the median value or rent affordable by at least half of the local market?

Some observations

Improving markets don’t always automatic mean price growth.  It means that sales might happen.

We are facing a different housing space over the next decade.  If this is news to you, then revisit here.

So, if I place, say Brisbane, in a recovery phase it doesn’t mean that locals will sell for more money in a year or two than they would now.  They just might be able to sell a bit faster than today and in some cases be able sell at all.  Think 1990s.

There is always an X factor that affects the market.  Past X’s include the Brisbane Flood; changes to FIRB or APRA constrictions and a recent X factor was the federal election.

I wrote late last year about 2019 being a year of two halves.  Go here to read about that again.  Boring!

Regardless of the time, some have the wrong product for the current (and/or local) active audience.  You need to have the correct market match.  We can help.

When it comes to most Queensland markets – underlying demand is rising, supply is constrained, and many joints are relatively affordable.  But no “boom” is likely, but for mine, no housing crash is likely either.

Some markets and housing products are positioned better than others.

To find out what is going on in south east Queensland, go here.

Getting better?

Apparently, property buyers can borrow 15% more than they could 12 months ago.

Well that’s the opinion of a mortgage broker I know.

Others are saying that this uplift, assuming it is true, will be taken up by home buyers and will translate into 15% house price growth.

Meanwhile, the ratio of mortgage debt to household income has jumped to a record high of more than 140% according to the Reserve Bank. The RBA also says that total household debt to household income is now over 210%.


Below is a housing affordability table that quite a few peeps have asked me to update.

Housing affordability – Australia capitals and Australia

Capitals House price Current ratio Affordable price Difference
Sydney $866,500 6.7 $702,750 $163,750 19%
Melbourne $709,000 6.0 $637,750 $71,250 10%
Brisbane $533,250 4.9 $584,250 -$51,000 -10%
Adelaide $465,250 6.7 $378,000 $87,250 19%
Perth $458,250 4.2 $592,500 -$134,250 -29%
Darwin $461,000 5.5 $453,250 $7,750 2%
Canberra $657,000 5.4 $654,250 $2,750 0%
Hobart $484,750 7.3 $358,500 $126,250 26%
Australia $530,500 5.2 $574,000 -$43,500 -8%
Matusik, CoreLogic + ABS.  Median detached house price as at Mid-September 2019.  Affordable price set at 5.5 times median household income.  Matusik estimates.

There is much more to housing affordability than the measures outlined in this table.

For example, such results on a decade based timeline would suggest that the average Australian with a 25 year standard variable P+I mortgage has been paying, during the 2010s, in real terms, around 35% of their household income in repayments.

For those interested in such stuff, the same scenario as above, saw the following levels of real mortgage payments per decade:

  • 1960s 7%
  • 1970s 8%
  • 1980s 19%
  • 1990s 21%
  • 2000s 19%
  • 2010s 35%

Yet there is little doubt that housing affordability has improved over the last 12 months.  Declining or stagnate prices and lower interest rates will do that.

I am not advocating the Perth or Brisbane are better places to buy nor am I saying that Hobart should be avoided.  Also, I am not saying that house prices across Australia will rise, whether it is by 8% (as some may think the table above suggests) or by 15% as mentioned in the introduction.

This is just information.  Some may use it to push their own barrows.  My role in their stories is zilch.  Big disclaimer et al.

Development hot spots

These suburbs are expected to be the top five housing development hot spots on the Gold Coast, and in Ipswich and Logan, over the next decade or two.

The table below provides a quick summary:

Suburb Dwellings* % of municipality supply
Gold Coast
Coomera 15,479 25%
Surfers Paradise 11,034 17%
Southport 4,311 7%
Worongary 3,598 6%
Hope Island 3,257 5%
Total 37,679 60%
Ripley 21,865 20%
South Ripley 14,561 13%
Brookwater 11,621 10%
Springfield Central 9,706 9%
Thagoona 6,519 6%
Total 64,272 58%
Undullah 32,195 26%
Yarrabilba 15,941 13%
New Beith 14,618 12%
Logan Reserve 12,538 10%
Jimboomba 11,478 9%
Total 86,770 71%

Matusik + Queensland Government. * Medium scenario.

These 15 suburbs are expected to house 4 out of every 10 new dwellings built in south east Queensland over the next two decades.

And yes I had to google where Undullah was too!

Density targets

The Queensland government have just released broad hectare land profiles for the Gold Coast, Ipswich and Logan.

The table below provides a quick summary:

Headline summary
Municipality Hectares Dwellings* % SEQld supply
Gold Coast 1,994 63,234 15%
Ipswich 6,532 111,617 28%
Logan 9,924 123,063 30%
Forecast housing typology
Municipality Higher density Standard urban Rural Residential
Gold Coast 82% 16% 2%
Ipswich 57% 42% 1%
Logan 18% 81% 1%
Expected dwellings per hectare
Municipality Higher density Standard urban Overall
Gold Coast 104 12 32
Ipswich 58 10 17
Logan 33 12 12

Matusik + Queensland Government. * Medium scenario.

Some comments

  1. These three municipalities are expected to accommodate close to three quarters (73%) of the new housing development across south east Queensland.The Sunshine Coast and Brisbane City Council are forecast to hold an additional 10% each.
  1. Most of the new housing development on the Gold Coast, and much of it in Ipswich, is expected to be higher density and, in most part, apartments. This is much higher than current market demand.
  1. The density expectations appear realistic for standard urban development but impossibly high for higher density areas. Density must be offset. To get people to give up their private space, the immediate public spaces must be of a high quality.  This often involves adequate green space and enough room between buildings for views, sunlight, privacy and climatic comfort.

It might pay for town planners to better understand current housing densities before they set such targets.

For example, these Queensland suburbs have the following number of dwellings per hectare:

  • New Farm 50
  • Surfers Paradise 34
  • Forest Lake 18
  • Southport 17
  • North Lakes 11
  • Springfield Lakes 8

The suburb of New Farm has the highest dwelling density in Queensland.

To download these new broad hectare land profiles, click here.

Poverty is nicer in a warmer climate

The story goes something like this….”Brisbane’s housing market will boom as more people in Sydney cash up and move to SEQ”.

Well the chart suggests that this story line isn’t coming true.

It would also appear the net interstate migration to Qld has peaked.  Well maybe?

There is little doubt that population growth to Queensland has increased.  Just look at the traffic.

The Sunshine State is increasing by 88,000 new peeps per annum at present, which is up from the recent low 57,000 annual intake in 2015 but is still someway off the 114,000 yearly peak ten years ago.

A quarter of the current growth is from interstate migrants, whilst overseas immigrants accounts for 40%. Births exceeding deaths – natural increase – accounts for the remaining 35%.

I am often asked why net interstate migration isn’t having a big impact on property values in SEQ.  My answer includes the following pearls of wisdom:

1.  Most buyers are much better educated these days.  They explore property values online and as a result aren’t being duped into paying over the top prices.  This was more likely in the case in the early 2000’s where real estate property portals were in their infancy.

2.  Many migrants from Sydney, and to some degree Melbourne, are economic refugees.  They cannot make ends meet in the southern capitals, so they are trying their luck in sunny Queensland.  They are often unemployed or underemployed; mostly rent and have filled up a lot of the apartment oversupply across inner Brisbane.  Poverty is nicer in a warmer climate.  Apparently.

3.  Queensland doesn’t have an 21st century economic engine.  It is relying on resources, agriculture, tourists and population growth.  Resources are employing fewer heads and tourism, retail, health and education jobs are often low paying ones.  Plus it’s hard to grow things in a drought.

This means that there are fewer jobs in Queensland when compared to New South Wales or Victoria.  They don’t pay as much.  Many aren’t full time.

In short, Queensland has little economic grunt.

Damn the torpedos, full speed ahead!

How low can they go?

Most of those working in the dismal science are calling for several more drops in the RBA cash rate, with some calling out a 0%.

Interestingly many of these same cats were talking about interest rate rises only 12 to 18 months ago.

The chart shows that falling interest rates do – eventually – help instigate house price growth.

Since 1990 the official cash rate has dropped 44 times.  In April 1990 the cash rate was 15.5%.  In late September 2019 it is just 1%.

For mine the cash rate will keep falling – at least two more times or by 0.5% in total over the next six months – in order to try and keep the Australian economy growing.  And of course, to help address the slide in housing prices.

Yet, how much impact this easing will have on house prices is questionable.

Next stop will be printing money and more shovel ready projects.  Road works aplenty; public sector bonuses galore and as many Adani’s as we can.

Damn the torpedos!


Damn the torpedos is one way of saying ‘bugger the consequence’s or ‘burn one’s boats’.  It is also a great Tom Petty and the Heartbreakers album from 1979, where Tom’s intent was to ‘kill disco’.

Moreover, “Damn the torpedoes, full speed ahead!”, is a famous order issued by Admiral David Farragut during the Battle of Mobile Bay in 1864.  It is a paraphrase of the actual order, “Damn the torpedoes! Four bells. Captain Drayton go ahead! Jouett, full speed!”.

Land market trends

This post I want to discuss the vacant land market.

Four tables have been included in this post.

Table 1: SEQ urban land sales 2009 vs 2019, sale volumes + median prices

LGA area 2009 2019 Ten year change
Sold $ Sold $ Sold $
Brisbane (C) 1,375 $278,000 1,750 $416,250 27% 50%
Gold Coast (C) 1,125 $248,500 1,475 $290,250 31% 17%
Ipswich (C) 1,350 $169,750 1,600 $203,000 19% 20%
Lockyer Valley (R) 350 $81,500 200 $149,750 -43% 84%
Logan (C) 950 $171,500 2,100 $226,750 121% 32%
Moreton Bay (R) 2,350 $214,750 1,975 $253,750 -16% 18%
Noosa (S) 150 $275,250 125 $340,500 -17% 24%
Redland (C) 250 $294,500 325 $319,250 30% 8%
Sunshine Coast (R) 1,475 $240,250 1,675 $275,500 14% 15%
Toowoomba (R) 850 $109,500 500 $180,250 -41% 65%
Tweed (S) 225 $267,750 200 $380,000 -11% 42%
South East Qld 10,450 $219,000 11,925 $278,750 14% 27%
Matusik Ready Reckoners, ABS, Qld + NSW Govt.  Financial years.

Table 2: SEQ urban land sales 2009 vs 2019, median lot size + $/m2

LGA area 2009 2019 Ten year change
m2 $/m2 m2 $/m2 m2 $/m2
Brisbane (C) 500 $556 410 $1,015 -18% 83%
Gold Coast (C) 700 $355 475 $611 -32% 72%
Ipswich (C) 510 $333 450 $451 -12% 35%
Lockyer Valley (R) 480 $170 525 $285 9% 68%
Logan (C) 575 $298 410 $553 -29% 86%
Moreton Bay (R) 600 $358 450 $564 -25% 58%
Noosa (S) 800 $344 665 $512 -17% 49%
Redland (C) 650 $453 460 $694 -29% 53%
Sunshine Coast (R) 660 $364 600 $459 -9% 26%
Toowoomba (R) 890 $123 850 $212 -4% 72%
Tweed (S) 725 $372 700 $543 -3% 46%
South East Qld 620 $353 475 $587 -23% 66%
Matusik Ready Reckoners, ABS, Qld + NSW Govt.  Financial years.

Two take outs

Table 1 shows that land sale volumes are up 14% across south east Queensland over the past decade, whilst end prices have risen by just 27% over that same time frame. At first glance this price escalation looks middling at best.

But table 2 explains that median land sizes have fallen by 25% in this neck of the woods since 2009, whilst the price paid by the punters on a price per square metre basis has risen by 66%.

So, across SEQ, lot sizes have fallen by a quarter and the real land price (best measured a rate/m2) has increased by two-thirds.

This reflects two trends:

  • tightening land supply and rising associated costs of land development, and
  • changing housing demographics and lifecycle preferences.

We won’t rehash the land supply story – go here if you aren’t convinced – but I want to include in this post a note about the people stuff.

The people stuff

There are two major housing demographic shapers over the next decade. These two forces apply across most of the Australia, including south east Queensland.

These two next big waves are first home buyers and downsizers.  Both these markets are looking for affordable housing outcomes and more often than not, smaller homes with less maintenance.

Smaller lots – especially those near high quality offsets like parks, cafes and views – are in increasing demand.

Most of us have busy lifestyles these days and much of a family’s spare time is now structured around kids’ sport, after school activities and homework.

For the adults going to the gymnasium is more popular than kicking the footy in the backyard.

And when we have a catchup with friends or relatives, the local café or boutique pub beats cleaning up the house post event (and having your house and possessions critiqued by others).

How can they live like that?  Oh, I thought they would have better stuff?  Did you see the state of the bathroom?  Who needs the aggravation!

Besides we are spending more and more time in front of our digital screens and less leisure time outdoors or with friends/relatives. Well at least not face to face.

And if the car hiring and car sharing trends are taken up by the mainstream, then less private land will be needed for the second or third car.  Well maybe.

Cars aside, these trends are also driving allotment sizes smaller.  Pun intended.

The next ten years

Table 3 below outlines the more commonly used allotment typology.

Our recent work suggests that we are likely to see further shifts towards more smaller allotments.

Table 3: SEQ past and future new allotment mix

Urban lot type Median lot size Past decade Next decade
Terrace allotment 250m2 5% 15%
Cottage allotment 350m2 10% 25%
Villa allotment 400m2 20% 25%
Courtyard allotment 500m2 35% 25%
Traditional allotment 650m2 30% 10%
Matusik, Qld + NSW Govt.  Past decade = 2009 to 2019.  Next decade = 2021 to 2031.

Matusik estimates for next decade.

Pricing benchmarks

Some think this is just a scam, a means by which developers can charge more per metre of dirt sold, and yes, they do charge more per square metre for the smaller allotments.

Table 4: SEQ past and current pricing benchmarks

Urban lot type Median lot size 2009 2019
Terrace allotment 250m2 130% to 140% 145% to 150%
Cottage allotment 350m2 120% to 125% 130% to 140%
Villa allotment 400m2 110% to 115% 120% to 125%
Courtyard allotment 500m2 105% to 105% 110% to 115%
Traditional allotment 650m2 100% 100%
Matusik, CoreLogic + PriceFinder.

Yet developers can only charge what the market will bear and table 4 shows that over the past decade, buyers are placing a premium on the smaller allotments.

This trend, I think, will accelerate in the future.

A lucky dip

This post is about new dwelling settlement valuations.

Such valuations have always been a lucky dip, but the situation seems to be getting out of hand.    There is a growing inconsistency with these valuations.

In a recent case, a new 26 apartment complex in inner Brisbane received settlement valuations ranging between 4% and 21% lower than the purchase price.

Sadly, this is not an isolated outcome. It is becoming the norm.

As a consequence, buyers of new dwellings are forced to seek several valuations and developers are obliged to pick and choose valuers in order to help buyers obtain their approved finance.

Despite some developers dropping the original contract price to help facilitate settlement, buyers are becoming understandably angry and the inconsistent valuations are leaving many in financial distress.

Yet the banks originally provide finance at the contract price and under certain terms but are now instructing many valuers not to put that price on the settlement valuation.  This, of course, often adversely affects the buyer’s payment terms at settlement.

This forced price reduction is eroding the values of each dwelling in a complex or estate and, in turn, is having a negative impact on new housing development.

Fewer buyers will be willing to buy off the plan unless this is sorted out and therefore less new housing projects will be able to start.

Many small to medium sized developers have already left this space as this trend has resulted in too much sales risk. The housing industry is suffering as a result.  Trades have limited work and many property related businesses are putting off staff.

The big guys will probably kick on, but the small to medium sized developer may soon disappear.

I think things need to happen here and fast.

If I had a magic wand I would:

1. Make the banks man-up and honour their original loan terms.

2. Spread the sales and marketing monies to property professionals like valuers.  They don’t get paid enough, especially when compared to the amounts paid to those selling and financing a property.

3. Limit the reliance on algorithm based sales data.  In-depth local knowledge is required, and each matched property needs to be actually comparable to the product being valued.

4. Loosen the comparison criteria that valuers are allowed to use.  It’s difficult to value a new product if you cannot use a comparable sale in the same development and/or cannot use the sale of a new dwelling in any nearby equivalent complex or estate.

5. Make each new project’s valuations subject to a peer review of at least three independent experts plus allowing for valid input from the developer.

6. Set up a simple panel system to help resolve project valuation issues.

7. Loosen the Professional Indemnity insurance noose that is currently around the valuation industry’s neck.  PI insurance is way too onerous for many professions these days and especially for valuers.

End note

Buying a property is often the biggest decision a person or family makes.  To many it is a very stressful experience.  The level of uncertainty and stress is even higher for those buying a property, off plan.

Yet it is really quite telling when right at the end of the process, once all that energy and effort has been expended – by the developer and buyers alike – that a property transaction is treated as a lucky dip.

More certainty is required at the onset.  A better way forward is needed.  The current situation can be changed.  It can be improved.  It must be.

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