[Smart Money]

Hi

Chris Joye is at it again and spruiking the property market in his blog Aussie Macro Moments and the post " All-important November house price index results: housing woe or wonder? "


Joye states "and if you have concerns about the Australian housing market's 'valuation fundamentals' (ie, you are worried about Steve Keen-like 'bubble trouble'), I would encourage you to reflect on the chart below. The chart demonstrates that one can explain about 92% of the total increase in Australian house prices between 1985 and 2011 simply by reference to household income growth and the long-term decline in mortgage rates as inflation stabilised during the mid 1990s (Braddick arrived at similar findings). Put differently, there is no evidence that Australian housing costs have materially outpaced household purchasing power over the last 26 years. Although if you relied on the hysteria and hyperbole regularly published on this subject in national newspapers, you would be bound to think otherwise! "


When comparing to 1985 lending conditions to 2011 Chris Joye does not mention the size of home loans e.g. $300,000 for FHB's, many FHB's loan to value ratios (LTVR) now up to 100% and other affordability measures. See some facts on affordable housing from Australian's For Affordable Housing This group represents a coalition of 70 organisations Australia wide. (it does not represent the opinion of 1 individual)

Previously I have commented that Chris Joye is just a business man and a marketing specialist. Spruiking the Australian property market to protect his business interests at Rismark International , RP Data, Business Spectator and Property Observer . I would expect most marketing specialists/spruikers to use traditional marketing strategies to promote the Australian property market e.g. Michael Yardney via Metropole, Cameron Kusher via RP Data and Dr Andrew Wilson via APM.

Chris Joye is an odd man out and uses his personal blog to spruik the Australian property market http://christopherjoye.blogspot.com/

This blog also has published posts on his child Jesse Joye on Tuesday Dec 13 http://christopherjo...se-joye_13.html , support for RBA Boss Glenn Stevens http://christopherjo...nn-stevens.html , a sunrise over the ocean http://christopherjo...is-morning.html , Aussie Housing Activity Recovering http://christopherjo...recovering.html , and a surfing location http://christopherjo...hese-waves.html ??


It is strange that he does not separate his personal family life from comments about the property market? Does Chris Joye have a professional life that is separate from his personal life? Is there a healthy balance between family/work/life?

With a cursory glance at his blog I suspect Chris Joye might be a little obsessed and unbalanced. With so many other professional references to his qualifications and experience e.g. on Rismark International Senior Team and Christopher Joye, Executive Director (Strategy) http://www.rismark.c...am/index.html#2 it is odd that he would publish his profile on his personal blog http://christopherjo...jesse-joye.html right next to a photo of his child and holiday snaps??

The header on his personal blog probably sums up his state of mind.... delusions of grandeur and a little unhappy. Why self promote on your personal family blog? See the header http://christopherjoye.blogspot.com/

Variously described by News Ltd as an "Inflation Hawk", "Iconoclast", "Svengali", a pollie's "Economist Muse", and "Pungently Accurate". According to Fairfax, the author is a "Renaissance man".

This post has been edited by Smart Money: 28 December 2011 - 01:01 AM

[staringclown]

Smart Money, on 28 December 2011 - 12:59 AM, said:

Why self promote on your personal family blog?

He craves credibility. That's why he's always trying to associate himself with the RBA.

The personal and family posts portray the human side of Joye. The pictures of the ocean are to show aspirational australians that they can be like him and live on the northern beaches.

[Crest]

I think its what's known as "facebook syndrome" ie broadcasting random personal stuff on the internet that most people arent interested in.

By the way would anyone like to see a picture of the toast I had for beakfast? It will be on twitter soon.

[tor]

Crest, on 28 December 2011 - 03:55 AM, said:

By the way would anyone like to see a picture of the toast I had for beakfast? It will be on twitter soon.

If it doesn't have a messiah or his mum burned into it I am not interested.

[urchin]

tor, on 28 December 2011 - 04:47 AM, said:

If it doesn't have a messiah or his mum burned into it I am not interested.

how about a kitty?

[tor]

urchin, on 28 December 2011 - 08:50 AM, said:

how about a kitty?

The internet has warped me and there is only one place that Hello Kitty is acceptable branding.

[Bernard L. Madoff]

tor, on 28 December 2011 - 09:01 AM, said:

The internet has warped me and there is only one place that Hello Kitty is acceptable branding.

+1

[Smart Money]

urchin, on 28 December 2011 - 08:50 AM, said:

how about a kitty?

Yep that does it google ' spruiker kitty Christopher Joye' and Simply Sustainable is ranked number 1

On that google search there is also some reference to a 'dead-pussy-bounce' in 1994???

[zaph]

his last post was 'the last word'. will this guy stick to his promise to shut up?

[Mr Medved]

Didn't he just publish an article titled "the last word"? He's like a turd you can't flush...

[staringclown]

Mr Medved, on 29 December 2011 - 06:18 AM, said:

Didn't he just publish an article titled "the last word"? He's like a turd you can't flush...

The john farnham of australian property...

[booboo]

Grrrr, I can't find the RP Data press release yet on their website.

SMH has there version here, but it doesn't say much, only that houses went up 0.1% SA for Nov. Chris Joye is, naturally, calling a rebound after one month when quoted:

Quote

Capital city home values lifted 0.1 per cent in November - the first increase since December 2010, according to the RP Data-Rismark Home Value Index. Regional house values also increased the most since December 2010, rising by 0.3 per cent.

Rismark director Christopher Joye said today the figures were an optimistic reflection of the sector’s potential in 2012.

‘‘For Australia’s capital city and regional markets, this was the single best monthly result since December 2010,’’ he said. ‘‘It augurs well for housing activity during the first quarter of 2012, which we project will rebound solidly.

‘‘The best proxy for housing demand - the number of new home loans approved for purchasing established properties - has risen robustly every month since its nadir in March.’’

[zaph]

booboo, on 30 December 2011 - 05:58 AM, said:

Grrrr, I can't find the RP Data press release yet on their website.

SMH has there version here, but it doesn't say much, only that houses went up 0.1% SA for Nov. Chris Joye is, naturally, calling a rebound after one month when quoted:

but have you noticed Joyes downgrading of late? no longer MD. now just an executive director, an analyst or a commentator at best.

ouch!

[Chimerica]

Up 0.1% seasonally adjusted for November? Getting 5 times better return in Ubank at 0.5% (6.11% pa) for the month of November without doing sweet FA or any extra holding costs or risk. Just a blip on the downhill trend.

[Crest]

Needless to say there will be winners and loosers in that result. The sydney market has been "stimulated" by Barry O'farrel's changes to stamp duty concessions.

Broadly though the market nowhere last month but the RP Data Housing Inflation Spruikers wont say that. Their media commentary throughout this whole year has been an exercise in economic spin doctoring IMO.

Instead of beating around the bush they should just come out and say "the vision for Australia is house price inflation so that more households can be in greater levels of debt." At the end of the day thats what they want isn't it?

[booboo]

zaph, on 30 December 2011 - 06:07 AM, said:

but have you noticed Joyes downgrading of late? no longer MD. now just an executive director, an analyst or a commentator at best.

ouch!

Yup. Interesting. Maybe it has something to do with Macquarie's part buying of Rismark, as pointed out in the comments section on the MacroBusiness article for the latest RP Data release?

[Sean]

Beyond any conflicted self-aggrandisement in his blog header, I would take his disclaimer content very seriously indeed (emphasis mine):

Quote

Please note that I may have an economic interest in any of the items discussed here. This material is not intended to provide, and should not be relied upon for, investment advice or recommendations. Readers are urged to seek professional advice before making any investments.

So he's not able to provide any actual professional advice, although (/because) he constantly spruiks the market. He also claims to be interested in matters of finance and economics generally, and yet all he ever wwrites about is the housing market, and specifically has a narrow obsession with house prices for some reason. Seems to be preying on the psychological weak spot in the average person's mind in order to assist the real estate/banking complex more than anything, although the amount of money tied up in housing in the total economy is admittedly pretty high.

He apparently duxed his economics course at Syd Uni, and at one time was informally advising Malcolm Turnbull in a manic kind of way. He claims here:

Quote

The chart demonstrates that one can explain about 92% of the total increase in Australian house prices between 1985 and 2011 simply by reference to household income growth and the long-term decline in mortgage rates as inflation stabilised during the mid 1990s

and yet, as a trained economst, fails to remark on the sudden price surge in 1987 following the collapse of the share market -- clearly something that cannot be explained by 'rising incomes' especially in a recessionary environment. He also fails to put together the fact that Australian banks commenced borrowing from offshore wholesale funds in competition with new NBL competitors such as Aussie Home Loans, increasing their total lending pool by about 30% in the process, from the late 90s -- not coincidentally when the latest price surge started -- and about 70% of the banks' business is tied up in home mortgages, not in lending to small business -- they are effectively building societies these days. So he is staring at clear figures that demonstrate house prices go up with the credit that is being extended by the banks, not by increased incomes or relatively low interest rates. Certainly interest rates are a little lower than long-term averages since the 80s (although they are high by OECD standards), and the dual household income factor has had some bearing on borrowing also, but in fact a study of dual incomes shows that few households have a '200%' income level compared with single median earnings, it's closer to 133% in fact.

So what are we to make of an 'economist' who conveniently glosses over the full range of historical economic information and events that should be informing commentary on what amounts to an unprecedented debt bubble? Well, unprecedented not counting the 1880 land price bubble that burst spectacularly...

[Crest]

Sean, my view is that the agenda of spruiker Chris Joye is this:

He wants house price inflation because he wants greater levels of household debt.

The reason he wants he wants inflating house prices and more debt is to implement and grow his shared equity scheme. (Google Joye and shared equity).

He wants to own half of peoples homes through the debt mechanism. The agenda is clear when you read his incessant spruiking. Thats why he is interested in housing.

Joyes spruiking is a means to an end, not an end in itself. The end game IMO appears to be to own part of peoples homes through shared equity.

That can only be achieved if you inflate home prices beyond the reach of the average Australian. Hence he cheers on house price inflation. IMO he wants unnaffordable housing to force Australian households into shared equity schemes.

http://www.choice.co...20mortgage.aspx

This post has been edited by Crest: 30 December 2011 - 11:04 PM

[staringclown]

Someone needs to tell Cameron Kusher (RPData) to get with the program. (At least as far as Canberra is concerned)

Housing market tipped to stay flat

Quote

Rismark director Christopher Joyce said the modest turnaround in the market was a direct result of interest rate cuts over the past few months, and predicted house prices would begin rising again in 2012.

But RP Data senior research analyst Cameron Kusher warned Canberrans not to raise their hopes.

He said the market needed a solid three to four months of housing value increases to declare a glut in the market over and suggested further increases might equal inflation at best.

''Canberra is one of the better performers but it could still record falls in the coming months,'' he said.

''Especially considering we had a rate cut in November and saw consumer confidence increasing but then had another rate cut in December and saw consumer confidence fall.

''Combine that with the fact that growth in private sector lending is fairly benign ... and the data shows most people are looking to save money rather than spend.

''While people are acting cautiously I can't see a big improvement in home values.''

Mind you the reporter can't even get Joyes name right.

[Smart Money]

Crest, on 30 December 2011 - 10:55 PM, said:

Sean, my view is that the agenda of spruiker Chris Joye is this:

The reason he wants he wants inflating house prices and more debt is to implement and grow his shared equity scheme. (Google Joye and shared equity).
IMO he wants unnaffordable housing to force Australian households into shared equity schemes. http://www.choice.co...20mortgage.aspx

Thanks I have read that article and it is alarming. If Christopher Joye has a significant share holding in this Rismark EFM product I can understand his motivation to inflate property prices and decrease affordability. He may be driven by greed to gain the highest return on his investment. Yet the consumer is corralled into limited finance and home loan options and that includes the Rismark EFM.

see Choice extract below

The RISMARK/ADELAIDE BANK Equity Finance Mortgage (EFM) - With it you can borrow 10%, 15% or 20% of the value of the property under a shared equity mortgage.

After 25 years, or when you sell the house, you have to pay back the initial amount you borrowed, plus 20%, 30% or 40% (double the percentage you borrowed) of the capital gain. If you make a loss, the lender covers 10%, 15% or 20% of the capital loss, which is then deducted from the amount you have to repay.

• With this loan, if you’d bought a house worth $100,000 in June 1987 in Sydney and borrowed 20% ($20,000), on average it would have been worth $461,490 in June 2007, and if you’d sold it you’d have to pay back about $164,600. So the equivalent rate of interest you’d have been paying to RISMARK would have been about 10.6%.
• If you’d taken a loan over the same period, the average standard home loan rate would have been 9.5%. Obviously with a standard home loan, you’d have had to make regular repayments over the whole period, whereas with RISMARK you only pay a lump sum at the end.
• Over a shorter period the picture could look very different. For example, if you’d repaid the same loan of $20,000 after two years, following the massive jump in house prices in 1988/89, you’d have already owed $49,137, meaning you’d have paid RISMARK the equivalent of an interest rate of 45.8%. While this was a time with exceptionally high increases in house values, property values go in cycles and for a normal consumer it’s sometimes hard to guess at which point in the cycle you currently are.

The bottom line is that the only way you come out on top is if you experience low or negaitve growth in the value of your home - but why would you want to invest in property if you expect that?

Here's a current marketing page for EFM http://www.efm.info/...ls&sv=Countries

Well I suppose if Rismark and RP Data are provided with so much power to influence market sentiment, the Australian public are the ones to blame. If Rismark International, RP Data and Christopher Joye are not challenged when information that is presented appears to be highly biased, misleading, deceptive or at times false we are all to blame.

Just let the property spruiking go unchecked!

Come in sucker

This post has been edited by Smart Money: 02 January 2012 - 07:13 AM