It’s been an interesting few weeks full of economic news which has led to a lot of uncertainty about the future of our economy and our property markets.
If you’re a regular listener you’d know that once a month I catch up with leading economic commentator Pete Wargent for these Big Picture podcasts when we look at the macro factors affecting our economy and our property markets, and we’ve got a lot to discuss today.
Interesting, only a couple of minutes after we recorded this show, the Queensland Government did a backflip and repealed its outrageous Land Tax, so even though we spend a couple of minutes talking about this in today's show, this tax is no longer a concern, however the underlying tendency for Governments to see property investors as an ATM hasn't really gone away.
And in other good news Governor Philip Lowe is easing his foot off the economic brake to take time to assess the impact of the most aggressive monetary policy tightening since the early 1990s. The RBA sensibly dropped back to a 0.25% hike this month taking the cash rate to 2.6%.
While it’s likely we’ll have one or two more 0.25% rate hikes, it looks like the peak of interest rate increases is in sight, and in today’s show you’ll hear Pete Wargent and me give you our thoughts on what that means for our property markets.
I also chat with Pete about the latest US inflation figures and interest rate hikes there which spooked the markets as there was no sign that underlying inflation is abating and the probability of a recession in the USA increasing.
You may remember that Reserve Bank Governor Philip Lowe warned that a deteriorating global economy would make it hard for Australia to achieve a “soft landing” due to the economic buffeting that is underway.
At the same time, he also said he would not be surprised if house prices fall 10 per cent from their peak. But then only a day later Jonathan Kearns Head of Domestic Markets at the RBA suggested the falls could be 15%.
But I don't necessarily agree with them, and I explain why in today’s show.
Links and Resources:
Metropole’s Strategic Property Plan – to help both beginning and experienced investors
Get a bundle of free reports and eBooks – www.PodcastBonus.com.au
Shownotes plus more here: Investing is getting harder; should I get out?| October 2022 Big Picture Podcast