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The Devastating Economic News About Rising/Falling/Stagnant House Prices…

From time to time I like to remind people of the wonderful poem, “Said Hanrahan” which I’ve included at the bottom for those who don’t know it. But basically, Hanrahan announces how “we’ll all be rooned” any day now.

While it’s basically about the trials of the farmer, it has a certain modern appeal for anyone listening to anything that any economist predicts after they’ve spent an hour or so gazing at the latest statistics.

The stock market on the other hand, is a different beast from your average economist, and rather than rely on the cold hard statistics or the cold, squishy entrails of a chicken, the share market is rather more emotional. That’s not to say that everyone playing the share market is irrational; some of them are just trying to make money out of someone else’s irrationality.

In the simplest terms possible let me declare: THERE IS NO SUCH THING AS ECONOMIC GOOD NEWS!

Now, I know that many people will dispute this but it helps to remember that economics is like the AFL premiership. Some people will be happy if one team wins, but most supporters of the other teams will be disappointed. And, let’s be clear here, most of the rest of the world will be unaffected and not care, but simply wonder what all the fuss is about.

So it is with economics. We can interview an Australian economist who tells us how terrible it is that house prices are slipping, even though last year, the interview was with someone who thought that it was terrible that house prices were rising because it either a) created a bubble which would eventually lead to tears, or b) keep first home buyers out of the market. Whichever way it goes, someone will be cheering, but, unlike sports commentary which tends to focus on the winners, most of the economic focus will be about who’s likely to lose badly.

I couldn’t help but wonder why the media keeps focusing on vested interests without stopping to point out that they are only interviewing these folk in the hope that they’ll give us some greater insight than – to paraphrase – “We don’t think we should be the ones to suffer, so please consider us and ignore the losers because they’ve always been losers and we’re not, so don’t change it so that we have to give up some of our booty because it’s really not that much in the scheme of things and if a few thousand need to go hungry or homeless or both it’s a small price to pay to ensure that nothing upsets those who’ve sacrificed lots to make sure that they’ll one day have a shitload of money…”

I always notice the little tricks with statistics at such times and the emotive plea to help those “mums and dads” who are never “dads and mums” or even “aunts and uncles”. And they’re certainly never “stepdads and mistresses”.

No, it seems that most landlords only own one property and the handful who own upwards of fifty properties each can be ignored, even though it works out that the ones who own more than one sometimes own lots more than one, so it does work out that even though there are more of the poverty-stricken mum&dad single owners than multiple rental property owners, the latter group still own most of the rental properties…

But leaving aside statistical tricks, I heard one amazing thing from an interview today. I joined late, so I can’t name the man who said this but he was asserting that some of these mums and dads who’ve only bought a property to finance their retirement (not for the tax advantage of negative gearing so I guess they haven’t bothered to claim anything there!!), will be forced to sell thanks to Dan Andrews proposed “rent freeze”. This will be awful, not just for them but it won’t help in any way because – and you may need to think about this – they won’t be bought by renters or investors!!!

Now, I would have expected that if there were a flood of properties on the market that at least some of them would be purchased by non-struggling investors, keen to add to their portfolios at bargain prices given – as the interviewee suggested – Andrews freeze would drive up rents.

But if they were driving down house prices, I would have also thought that some people saving to buy a house would be renters and that when they bought a place then that would be at least one or two out of the rental market.

However, no. Neither a renter nor an investor will be those who are buying these properties from the mums and dads and uncles and aunts or anyone with a grandfathered investment. Verily I ask, who shall these buyers be that are neither an investor nor a renter? Just some average home owner who wants to expand next door?

It’s a mystery.

Anyway, as I said at the start the conclusion of any economic news is that we’ll all be rooned any day now. To quote Hanrahan directly:


“We’ll all be rooned,” said Hanrahan,

In accents most forlorn,

Outside the church, ere Mass began,

One frosty Sunday morn.

The congregation stood about,
Coat-collars to the ears,
And talked of stock, and crops, and drought,
As it had done for years.
“It’s lookin’ crook,” said Daniel Croke;
“Bedad, it’s cruke, me lad,
For never since the banks went broke
Has seasons been so bad.”
“It’s dry, all right,” said young O’Neil,
With which astute remark
He squatted down upon his heel
And chewed a piece of bark.
And so around the chorus ran
“It’s keepin’ dry, no doubt.”
“We’ll all be rooned,” said Hanrahan,
“Before the year is out.
“The crops are done; ye’ll have your work
To save one bag of grain;
From here way out to Back-o’-Bourke
They’re singin’ out for rain.
“They’re singin’ out for rain,” he said,
“And all the tanks are dry.”
The congregation scratched its head,
And gazed around the sky.
“There won’t be grass, in any case,
Enough to feed an ass;
There’s not a blade on Casey’s place
As I came down to Mass.”
“If rain don’t come this month,” said Dan,
And cleared his throat to speak–
“We’ll all be rooned,” said Hanrahan,
“If rain don’t come this week.”
A heavy silence seemed to steal
On all at this remark;
And each man squatted on his heel,
And chewed a piece of bark.
“We want a inch of rain, we do,”
O’Neil observed at last;
But Croke “maintained” we wanted two
To put the danger past.
“If we don’t get three inches, man,
Or four to break this drought,
We’ll all be rooned,” said Hanrahan,
“Before the year is out.”
In God’s good time down came the rain;
And all the afternoon
On iron roof and window-pane
It drummed a homely tune.
And through the night it pattered still,
And lightsome, gladsome elves
On dripping spout and window-sill
Kept talking to themselves.
It pelted, pelted all day long,
A-singing at its work,
Till every heart took up the song
Way out to Back-o’Bourke.
And every creek a banker ran,
And dams filled overtop;
“We’ll all be rooned,” said Hanrahan,
“If this rain doesn’t stop.”
And stop it did, in God’s good time;
And spring came in to fold
A mantle o’er the hills sublime
Of green and pink and gold.
And days went by on dancing feet,
With harvest-hopes immense,
And laughing eyes beheld the wheat
Nid-nodding o’er the fence.
And, oh, the smiles on every face,
As happy lad and lass
Through grass knee-deep on Casey’s place
Went riding down to Mass.
While round the church in clothes genteel
Discoursed the men of mark,
And each man squatted on his heel,
And chewed his piece of bark.
“There’ll be bush-fires for sure, me man,
There will, without a doubt;
We’ll all be rooned,” said Hanrahan,
“Before the year is out.”

John O’Brien


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  1. JulianP

    I recommend readers to an article earlier this year by Michael Pascoe writing in the New Daily where he argues for “…governments to meaningfully re-enter the housing market”.

    Part of his introduction states: “Neither federal Labor nor the Coalition has any interest in dealing with the fundamentals underlying the crisis. It is politically too hard for them to dream of announcing policies aimed at providing large-scale public and affordable housing and dampening residential housing price rises – and that’s without considering how conflicted many politicians are given their own property portfolios…”.

    Mr. Pascoe reckons that the waffle of “experts” willfully ignores “…the core truth of Australian housing – it is a game controlled by existing property owners devoted to maximising the return on their assets over time.”

  2. RomeoCharlie

    I got a petition from Albo himself today asking me to sign a petition.I do do not read it but the gist seemed to be that the Greens were blocking this wonderful initiative of Labor’s to ease the housing shortage. Sadly I not only felt unable to sign, I felt the need to reply that I thought the Greens had it right. Imagine my pleasure when I read that a new CFMMEU bloke told the Press Club much the same thing today, I wonder if Albo will read my response or whether I’ve just had myself deleted from Labor’s mailing list.

  3. andyfiftysix

    in all the western world, housing has become an unbearable burden. The new slave is before us.
    WTF did we not clip it at the start? Low interest rates and banks all to willing to lend exorbitant amounts have crushed the great australian dream. We allowed greed to set the agenda. Governments are our worst enemies at times.
    I will say it again, we need houses to halve in price. Thats equivalent to a $200-$400 a week pay increase. We all live in a bubble of economic thinking without a clue as to what we do. Being scared of a housing crash has created a bigger bubble, so i say take some brave pills and do it differently cause as we are currently handling things we are only making it worse. Stupid lemmings is what we are.
    The liberals were so far down the path of madess that we have meakly accepted labor’s bare cupboard of ideas.

  4. Andrew Smith

    Firstly, partly agree with Julian P, but IMO it’s state and local governments who can or need to do something i.e. more investment in public housing and relaxing local zoning and regulation that preclude higher density, micro housing, caravan park/cabins etc.; this is the real ‘property Ponzi’ to maintain prices, though ‘value’ can fall versus blaming (undefined) immigration for unclear demand housing types (because no one actually knows?).

    In fact, if one uses a couple of basic metrics i.e. ‘value’ derived from market rents at 7% p.a. and related same return requires the ‘price’ to double every decade, just to tread water; by such measures most Australian property is stagnant with prices outrunning value, or not all…..

  5. Lyndal

    Meanwhile the recent census showed once more that some 10% of housing is empty.

  6. Terence Mills

    A little over a year ago we learned that Australia’s unemployment rate had slipped below 4% in March 2022, to 3.95% – the lowest rate in 48 years.

    Since then the unemployment rate has dropped further, to 3.5%

    Well that’s great isn’t it ? Well NO ! The Reserve Bank are horrified and have told us that the unemployment rate must go up to to at least 4.5% for all to be well.

    Hanrahan was right !

  7. wam

    Limit the investment rorts to one house. That will flood the market and and gather capital gains tax.
    yes bring back the lying rodent he can solve labor’s woes.
    The loonies can say whatever tickles your fancy, RC, but the CMFEU is proposing a just tax.

  8. leefe

    ” … economics is like the AFL premiership. Some people will be happy if one team wins, but most supporters of the other teams will be disappointed.”

    Well, yes, but if we remember the golden rule of ABC*, the devestation will be limited to one relatively small and irrelevant group.

    (* Anyone But Collingwood)

  9. Michael Taylor

    leefe, your last sentence … I’M WITH YOU ON THAT ONE.

  10. Clakka

    I recall hearing quite a number of years ago that the Dutch had the longest continuing record of property prices, going back 800 years, and that the trend was an annual increase of 1%. Unfortunately, I’ve never managed to find that data online.

    Nevertheless, the following article will provide some insight across many nations including Oz, where long term trends reveal growth rates of between 0.5% and 1.0%. Of course, the significant peaks way above trend are deliberately manufactured by governments in league with banks and other bastards. Usually when governments, banks and other bastards have partaken of wars, GFCs and other ambitious commercial stupidities that result in an ultimate strangulation of liquidity, they resort via guile to fleecing the ordinary folk, and mainly the less fortunate.

    Of course work-a-day economists, being toadies to governments, banks and bastards, never call them out. The original piracy and crime, incursion, land theft, land banking, extortion and enslavement. With many sophisticated levers available to the law makers wanting votes. And when their stupidities have strangled liquidity and stocks become uncertain, those levers are there waiting, along with the ‘aren’t we smart’ politicians on their blocks ready to dive in early to join the ramp to profit levels outstripping the stock market and other funds too. But for the great leveller, the non-vote-winning hungry beast of inflation.

    After all, customers are born, live and die, or are imported to feed the governments, banks and bastards.

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