The start of the public land sell-off?

If you are confused with what’s presently happening within the Australian economy you’re not alone. Already in 2014 we have seen the announcements that motor vehicle manufacturing in Australia is closing down and this week Qantas announced that a further 5,000 jobs will be cut by the carrier. It’s abundantly clear that since the global financial crisis (GFC) Australian businesses are adopting a new mandate: Do something. Either lead, follow, or get out of the way!

Last week we saw another shock announcement with CAPEX dropping in the December quarter which in all probability confirms that Australian businesses are more than cautious in 2014 – which certainly contravenes previous speculation that the markets were upbeat about what 2014 will bring. Whilst this does not spell the end of the world this significantly highlights that consumer sentiment is wavering, which is consistent with what we saw during and since the GFC.

Like most progressive businesses we had a session yesterday with our real estate coach Daniel Spencer where the Australian economy was summed up with just the one sentence: “The greatest fear is the unknown”. If you cast your mind back to the GFC businesses’ engagement all but came to a standstill given consumers were distracted looking for answers and signs. What we are seeing today are economic machinations busily at work in stark contrast to what we have seen before.

I have no idea how mainstream media missed an announcement this week that Ku–ring–gai Council resolves to investigate the future of the Gordon Golf Club site for the purpose of looking at possible future uses. Now this is a big story which in all probability will lead to plenty more councils reviewing their assets with a view to selling out to cashed–up property developers. Ku–ring–gai Council made the announcement last Tuesday that they are looking at a new sporting facility, including options for the first indoor sports centre in Ku–ring–gai (they sort of hid this as second point), a range of residential housing, small neighbourhood shops, local park and other community facilities. The council have another public golf course and rest assured that too will end up on the planning board as councils across the country look to cashing in on community assets.

I hate to say I told you so, however back on April 9, 2010 I wrote: Record population growth – and (possibly) an even scarier outcome. “So what can we expect? The greatest sell–off of (open space) land for residential development and Mosman (given its abundance of foreshore land) would become a major revenue raiser for funding sustainability. The ‘posh’ will utter, gosh! A strong possibility that Mosman sea scapes could resemble those from Whale Beach to Palm Beach. Of course governments will say ‘it is all in the name of economic progress’. Simply put – we may believe we are the custodians of open space and even though we don’t have title to this lifestyle privilege, money talks and many areas that are untouched could lose their virginity.”

“We now find that one in four NSW councils is on the brink of being unable to pay for essential services. We are already hearing murmurs that some councils are looking at selling off public golf courses and replacing them with housing estates.”

So there you have it – watch this proposal very carefully as it in all probability will open Pandora’s Box.

It is succinct and very clear why the Australian economy is experiencing behavioural problems when one closely examines these graphs. So based on this data one should not expect any rebounds anytime soon.

He has also been writing real estate blog Virtual Realty News since 2000.

The RWM real estate model has sold in excess of $1 billion in database sales globally.