It’s All Happening in QLD & WA !!

Adversity surrounding European economies is likely to have an increasing impact on Australia's economy and consumer confidence, however Australia has significant buffers to offset European  troubles.

Australia with relatively low sovereign debt and above 4% Reserve Bank  interest rates has the capacity to stimulate its economy by increasing borrowings and decreasing interest. We are likely to see interest rates being eased over coming months.

Earlier this month, Deputy Premier and Treasurer of Queensland, Andrew Fraser said "Around the world, in the face of the fallout from the European crisis, Australia is regarded as a stand-out performer.

"The last OECD forecasts showed that in 2012 Australia would lead the growth league table of developed nations.

"While weaker global economic conditions have trimmed current year forecasts, the Australia’s Treasury continues to forecast Queensland economic growth will be ahead of the nation in 2012 & 2013," Mr Fraser said.

"Our forecast growth is not only set to out-perform the nation this year, it will lead the nation in the coming financial year as we power up to 5% growth with WA predicting 4.25%, while Victoria predicts next to no growth”, Fraser added.

Federal Treasurer Wayne Swan was reported in December 2011, Australia's growth figure for 2011 was underwritten by an amazing performance in Western Australia, which recorded an 8.4 per cent increase in state final demand (which measures spending by the private and public sectors), and Queensland's newly reborn activity showing late increased growth of  3.5 per cent for the year.

Also reported in December 2011, Australian State growth elsewhere in 2011 was either anaemic or non-existent. While NSW posted 0.5 per cent growth, Victoria edged into reverse, recording a 0.1 per cent fall in state final demand. Only South Australia was worse, contracting by 1.6 per cent.

WA and QLD are benefitting from an increasing world appetite for raw resources such as iron ore and coal. The forward orders and continued urbanization demand from China and India in particular point to a decade ahead of ‘boom times’ for these two Australian resource rich states.

Already the huge demand for jobs and housing in the mining centres within WA and especially in Regional QLD, far outstrip available supply.

Sources: Australian Financial Review, Devonport Times, 13.01.12 QLD Government Press Release

NEWS SNIPPETS

• Victoria Missing out on growth
Herald Sun 16 Jan 2012

ECONOMIC growth in Victoria is lagging as the state misses out on the spoils of the mining boom propelling Western Australia and Queensland forward, new figures show.

Official figures released yesterday reveal Queensland's economy grew 3.4 per cent in December 2011, followed closely by WA with 3.3%.

• QLD The Place For Jobs

QLD Treasurer, Mr Fraser said 13 Jan 2012, “Employment and population forecasts for Queensland were set to remain above the national forecasts, while inflation was now forecast to be 2½% for the current year – down from a Budget prediction of 3% for 2011-12.”

• Lending For New Homes Up 22% In QLD

Lending for the construction or purchase of new homes in Queensland rose 22.2% in November and 17.6% over the November 2011  quarter. Australia wide (including QLD), lending for new homes was up 13.1% in November. but down 2.8% over the quarter.

Queensland new home activity is a standout reversal of activity as mining led economic activity takes up traction

• ANZ QLD Property Prediction

12-01-12 Property Confidence Analysis by Warren Hogan & Paul Braddick, ANZ Bank

On balance, the Property Council of Australia-ANZ survey shows an increasingly positive view of Queensland property with the Property Council of Australia-ANZ confidence index increasing to 113 (from 103 in September quarter survey). This result in part reflects a more buoyant outlook for the Queensland economy in 2012.

The Victorian economy is forecast to slow sharply in 2012 placing further downward pressure on prices. In contrast, Western Australia and Queensland are expected to lead the two-speed economy in the years ahead. Buoyant labour demand and rapid gains in household incomes in these 2 states will limit further downside to house prices and eventually drive

Queensland $10,000 New Home Boost Grant Extended

$10,000 tax free now on offer to investors and owner occupiers for new homes until the end of April 2012.

The QLD Government has extended this special benefit for new home construction which is providing economic stimulus to the state.

Not only are owner occupier home buyers taking advantage of this free $10,000 grant, but many property investors are taking up this extra cash benefit opportunity.