Upcoming election boosts CEO confidence as FHBs continue to struggle: Robert Simeon
Sometimes the truth hurts and the message in the latest CEO Pulse sent a very clear message to the Gillard government.
CEO Pulse: CEOs feel better now which just so happens to be the most positive for two years – that’s because we are closing in on an election and a change of government.
“CEOs are fed up with Treasurer Wayne Swan and the government, but that’s no surprise, and they think Treasury usually gets its forecasts wrong, which it does, but nevertheless Australia’s bosses are feeling better about their own businesses and the economy than they have since this time in 2011.”
“60% expect to increase sales over the next twelve months, up from 52% three months ago, and 53% expect to increase profit, up from 48%. In the second half of last year, most CEOs thought their profit would fall in 2013, which was a remarkable statistic.”
“Two thirds of CEOs say they aren’t delaying any capital expenditure decisions until after either the federal budget or the election in September (18% said they were waiting ‘til after the election), but unsurprisingly, the overwhelming majority (86%) said a Coalition victory would be the best for the country and for their business.”
The declines across Australia continue for first-home buyers with loan approvals falling 1.5% in February making up just 14.4% of the overall market. I have never been a supporter of artificially inseminating property markets by throwing around free money. It should be noted that when vacancy rates are at all-time lows this further complicates the issue given property rents are climbing much higher than property values. Rental growth to keep pace with house price growth over the next two years led by WA: NAB survey – Rents are forecast to rise 3.6% over the next two years.
As a result 18,448 more residents have left New South Wales than arrived over the year. This should and must be a major concern for the NSW government given history clearly shows that when a family moves seldom do they return – given the decision is all about lifestyle.
We are one month away from the federal government delivering its final budget deficit. Massive problems with the collapse of the price of carbon in Europe which sits at around $3.35 a tonne and Australia’s price is fixed at $23.00 per tonne until 2015. Opposition treasurer commented, “If the European price today is to be applied to the budget there would be a budget hole of at least $7 billion in just one year.”
Last week we learnt the “World’s Greatest Treasurer” Wayne Swan is now refusing to pay the $725 million collected as flood recovery monies even though it appeared in the forward estimates. This is the money that the Gillard government imposed (otherwise known as a levy) on Australian taxpayers. This highlights how bad the Gillard government’s finances are despite constant reassurances – remember the 2012/13 budget was a non-negotiable return to surplus!
Out of interest from 2002 – 2007 the Howard government spent $978 billion from revenues of $1.067 trillion – from 2007 – 2012 the Gillard government spent $1.729 trillion from $1.543 trillion in receipts.
The upcoming Fudge – it will fascinating.
Robert Simeon is a director of Richardson Wrench Mosman and Neutral Bay and has been selling residential real estate in Sydney since 1985. He has also been writing real estate blog Virtual Realty News since 2000. The RWM real estate model has sold in excess of $1 billion in database sales globally.