Sydney Perceived As Global City
Adam Zuchetti and Nick Bendel put up an article for the website The Adviser where they dismiss any talk of Australia (and specifically Sydney) being in a property bubble. Australia, after all, is a very big geographical entity and the performance of Sydney alone cannot put the entire country in the ‘bubble’. It will be wise if we remember that many capital cities- Perth, Darwin and Canberra being just a few examples- are still languishing far behind.
Sydney, a true global city
Sydney, too, is nowhere close to a bubble. It just so happens that Sydney is fast changing plumes. It is being perceived as this global city, filling the void the southern hemisphere has had for long. This new perception, among other things, has resulted in skyrocketing prices for the harbor city.
The trend across the globe
At the moment, the global trend shows that the best city in any country is outshining its peers by a pretty long margin. Sydney is just following the trend and for information’s sake, it is not beating Melbourne hollow yet.
You can read the original article here.
Bubbles should be rationally enquired
When we talk of a bubble we forget to make a rational enquiry. And it is so because ‘bubble’ is a concept that takes wings piggybacking on investor psychology and then turns into mass hysteria. Maybe, just maybe, that all the while there may not be any real reason to panic. This is exactly what may turn out to be the case in Sydney, too, if we fail to conduct a rational enquiry.
Why prices seem so high
Why do prices seem so high? I think it has something to do with the slumber Sydney was in for many years. It was those plateaued prices which make the present prices look so good. We are just compensating for lost years if you come to think of it. It is no big hike.
And also, do not make the mistake of reading any price rise without making an inflation-adjusted reading or your figures will be skewed. If prices are rising, so are the household incomes, so can’t we contest that?