Bullets dodged, stars aligned as Australia’s outlook is transformed, by Robert Gottliebsen.
I learned yesterday that one of Australia’s largest home builders was planning a substantial reduction in its work force next week had Bill Shorten won the election.
Others would have quickly followed and, indeed, some home builders had already started their ALP-driven retrenchment program. Those mass sackings would have triggered a steep decline.
The simple fact was that for the last six months very few home sites were sold and the home building industry was facing a deep slump in early 2020, and adjustments had been made in advance.
At such a time the negative gearing clamps would have been catastrophic. There will still need to be some staff cuts among builders because the pipeline is empty but they will not be nearly as savage. …
It is too early to see a sudden swing to people building homes and buying land but the building development industry has no doubt that there will be a substantial increase in demand.
The real estate market will not return to boom because there is still a credit squeeze but further big falls are off the table. …
I have had the chance in the last 48 hours to talk to a lot of small and middle sized businesses and the phone has been running hot because of my role in the mobilisation of retirees.
Everywhere there is a feeling of incredible relief and in due course that relief will be reflected in confidence.