Everything in Australia's economic favour, but our property markets still hurt by lack of confidence: Terry Ryder

We’re the world’s wealthiest people, but we suffer from a poverty of optimism.

We remain a nation with its hands thrust in its pockets, neither spending nor investing. And I think I know why.

In simple terms, Australia has lost its mojo. We’re no longer the brash young over-achievers who confidently went out into the world and took on all comers.

If ever an event presented a microcosm of a nation’s demeanour and performance, it was the London Olympics. Australia, which had been a rising force in world sport at previous events, slipped back among the also-rans.

Ditto our cricket team, once feared but no longer the benchmark –smashed by the West Indies in the World Twenty20 semi-final.

We’re seeing the same loss of self-belief among mining magnates. The one thing that distinguished the big mining companies in the past was their ability to keep their focus on long-term goals and shrug off short-term aberrations like the recent dip in prices for coal and iron ore.

Many of the projects that have been earning mega export dollars recently were conceived and/or advanced in the shadows of the GFC. If their proponents had allowed short-termism to sway them, those projects might not have been started, let alone completed.

But confidence has evaporated. BHP Billiton’s recent performance resembles a colossal dummy spit, while the message from Rio Tinto vacillates in tune with short-term fluctuations in iron ore prices.

The latest survey by Credit Suisse named Australia as the wealthiest of 216 nations surveyed. Our median wealth per adult is $US193,653 and our proportion of individuals with wealth above $100,000 is eight times the world average.

You’d never know it watching average Australians going about their lives, saving, not investing, talking, not doing, following, not leading.

A recent article that compared the global economy to a hospital made this comment: ''Europe's on life support, the US is in the general ward and Australia is in the ward for hypochondriacs.''

That perceptive observation may contain the best clue to our loss of mojo. Our traditional ties, economically and psychologically, have been with Europe and the US. Their economic declines have left us feeling insecure.

So despite everything in our favour – the world’s greatest wealth, the strongest economy in the Western world, low unemployment, rising incomes and attractive interest rates – we remain steadfastly pessimistic.

This has everything to do with real estate because the single biggest ingredient in a rising market is the intangible factor known as confidence. We’ve forgotten how to think and act optimistically – and our big city markets, though no longer on their knees, are barely walking.

The Perth property market speaks loudly of our malaise. If ever a market ought to be driven by self-assured citizens, it’s in Perth. WA leads the nation in every economic indicator that matters, including population growth, employment, retail spending and economic growth.

Western Australians would have to be confident, wouldn’t they? Hell, no. The consumer confidence survey by the Curtin Business Schools and the WA Chamber of Commerce found it’s fallen to its lowest level since the GFC. Little more than a third are optimistic.

Despite all the growth factors pumping through the WA economy, Perth housing prices have barely budged. Rents certainly have – the rental report for the September quarter from Australian Property Monitors recorded a 15% annual rise in the Median rent for houses and 11% for units – but there’s been only the faintest glimmer of a recovery in house prices.

The answer lies in that confidence survey. It leaves me wondering: what will it take for us to feel confident again?

Terry Ryder is the founder of hotspotting.com.au and can be followed on Twitter.