Linz’ Musings – May 17th, 2019

G’day all

Happy Friday! In this election version of our newsletter our country will be headed to the polls this weekend to vote for who we believe should be leading us forward for the next few years…or considerably less, if recent history is any indication…

With that in mind, and irrespective of your view or political alignment, I believe everyone would agree that Australia lost a legend of Australian politics this week in Bob Hawke. Labor’s longest serving prime minister, the Hawke’s government did a lot for the economy of this country and helped put us in a great global position. From creation of Medicare, to deregulation of the financial sector and floating the Australian Dollar, much of this was pivotal in shaping economic Australia. One of Australia’s greatest Prime Minister – RIP Mr R J Hawke.

On the other side of this particular political coin, we have struggled in the past 8-10 years to have any consistency or leadership in the role. This election does seem to have a larger impact on the property market in Australia than elections of the past. It will be interesting to see how Labor’s concept of scrapping Negative Gearing (one of the most overused, and overrated strategy in our market in my view) will effect the market; with Morrison’s implementation of a new First Home Buyers (FHB) Grant, where essentially if the first home buyer can save 5% of the deposit, the government (read taxpayers) will fork out the remaining 15% of the deposit so the FHB can avoid mortgage insurance… interesting…

I do feel that with the FHB Grant probably imminent, irrespective of which party wins, and an interest rates cut imminent in June as well (the banks are already starting to pass this on, thats how certain it is…) that we may start to see the bottom of the property clock, particularly in Melbourne and Sydney and prices start to pick back up again, but lets watch and see

Anyway, I would wish the pollies all the best in the election and say “may the best candidate win” but I am not certain the “best candidate” is even running…but that’s another blog for another day…

Have a great weekend all and Happy Investing…oh and voting!!