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TIP: property turnaround keeps rates steady, big banks struggle to compete, retail sales drop again

Sometimes you just need to call in the Hoff to fix the problem

The Reserve Bank kept the official cash rate at 1 per cent yesterday in light of the unexpectedly rapid turnaround in residential property, but warned global economic conditions are going to push rates down further. Continued reluctance among businesses to invest due to this global uncertainty, weak wages and jobs, and further depression of consumer spending were all signals of future cuts.

Yet in property, CoreLogic figures show residential listings increased by nearly 3 per cent in August, ahead of the traditional spring selling season. According to UBS research, more and more buyers of these homes will secure mortgages via brokers; direct-to-branch applications have dropped 11 points since 2013.

We know more of these loans are also being sourced beyond the major banks. The big four currently account for 79 per cent of all home loans in Australia, but according to speakers at the FINSIA conference in Melbourne yesterday, these customers are being picked off by more agile and hungry second-tier competitors for share of the combined $30 billion in home mortgage profit shared by the majors.

ANZ, which has been hemorrhaging mortgage business in the past 12 months, reckons it has turned the corner and is now rebuilding its home loan book. Why? Chief exec Shayne Elliott says that since it launched its campaign fronted by David Hasselhoff in early July, it has been smashing its volume targets on a daily basis.

Cue Baywatch gags about breathing life back into a drowned man.

Maybe he could do something for people in WA in particular who have been the hardest hit by economic conditions. S&P's mortgage arrears index rose 1.5 per cent in the 12 months to June.

Retail still in the pits

Some good news: Australia's national accounts posted their first monthly surplus in 44 years in August, thanks to a surge in commodity exports. That's an extra $5.9 billion on the books, which should have a positive flow-on effect for the value of the Aussie dollar.

Some not-so-good news: retail sales fell 0.1 per cent in July, after economists expected a 0.2 per cent increase born from low interest rates and income tax cuts. That had an actual impact on the Aussie, which fell below US67c yesterday at the news.

Not everyone is retail is feeling the pinch. Aldi is apparently experiencing double-digit growth at the moment as consumers look for more bang-for-buck. And food sales were up 0.3 per cent across the board. In any case, AMP economist, Shane Oliver reckons it's probably a bit early to expect stimulus measures to have resulted in a July kick-off on spending.

Moves and countermoves

Taking advantage of the problem of unsold new apartment stock holding up new developments, a 360 Capital-run fund has just purchased a parcel of 23 unsold apartments at a Gladesville project for $16.5 million, at a 33 per cent discount on the asking price.

Australian Fractional investing tech play, BrickX is back in the news today, as it pushes to raise capital to expand its portfolio of houses and flats.

And the former head of sales for the collapsed Purplebricks Australia, Luke Pervan is being backed by WIN Television for his new operation, Betterway Real Estate, which mirrors the former's fixed-fee model. They're promoting the offering in Newcastle, Wollongong, Gold Coast and Sunshine Coast.

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