Category: Shopping,Hospitality

How much does Christmas affect the economy?

By Inspiring Interns | December 2019

When you think of Christmas, you probably think of presents, family, and food. It’s probably quite unlikely that economics comes to the forefront of your mind. But perhaps it should. One of the biggest business implications of Christmas is economic – put more specifically, the massive increase in spending. Generally, Christmas is thought of as very beneficial to the country’s economy. Here’s how Christmas affects the economy.

A boost in production
In the months leading up to Christmas, there’s a huge increase in the need for manufacture. This is particularly prevalent in the toy industry, where the vast majority of sales happen in the lead up to Christmas.  In fact, a lot of the toy industry’s product development and timing is based around the Christmas period in order to maximize profits.

Black Friday and Cyber Monday
Once purely an American tradition, Black Friday and Cyber Monday have been gaining globally in recent years. The Friday and Monday following American Thanksgiving now make up one of the biggest shopping weekends in the calendar. Not only do people spend a lot at this time in the lead up to Christmas, but it’s essentially the biggest weekend for discounts in retail, too.

Temporary work
Many retailers and food and drink establishments require more staff to deal with the busier period in the lead up to Christmas. This is predominantly true for larger companies, who need to take on an abundance of staff to deal with online orders in particular. This leads to an economic boost, with businesses increasing their profits and temporary workers finding themselves with a little extra cash to spend.

Spending increases
What’s uniquely interesting about the Christmas period is that spending increases in pretty much every industry. Food and drink, consumer goods and homewares, plus entertainment all get a Christmas boost. Even industries like cinemas and pubs can reap the benefits of our spend-happy culture during this period.

Lessened productivity
Those who work in an office job will likely recognize the slowing down of productivity as Christmas approaches. The abundance of events and parties, alongside the increase in distractions and decrease in motivation, can mean that non-consumer based businesses can find December a bit of a struggle.

Christmas Day
The actual day of Christmas is one of the least economically important days of the year – most people don’t shop at all on this day. In fact, the majority of big businesses aren’t even permitted by law to open on Christmas day. There is a slightly increasing trend for afternoon online shopping for those who want to get in on the January sales early.

Boxing Day sales
Contrary to some expectations, the period immediately after Christmas doesn’t reflect a prompt drop in spending. This can be mostly attributed to the Boxing Day and January sales. Although these sales have taken a slight hit thanks to the growth of Black Friday and Cyber Monday, they are still some of the premier shopping events in the UK & Australia. Many take them as an opportunity to spend their Christmas money, or as a sort of “last hurrah” in terms of holiday excess.

January cutbacks
Post-Christmas, the vast majority of people experience a bit of metaphorical belt-tightening. The excesses of Christmas are over, and pretty much everyone has overstretched themselves. January is one of the lowest periods in terms of spending, as everyone beings reigning themselves in following the Christmas hysteria.

This year, Andrew Mackenzie, Paramount Private Estate Sales Manager, is hoping to make your Christmas even more special, by providing you with the opportunity to snatch up some prime reality here in Baldivis, just a short drive from the ocean.

Paramount is situated at the southern end of Baldivis Road and rises westward towards the ocean.  From its elevated position on the ocean-side, Paramount is destined to become Baldivis’ premier land development, with stunning views over bushland and to the hills.

It’s easy to imagine living in a beautiful new home that’s surrounded by parks and natural bushland, only a short distance from great schools, shopping centres and all your amenities.

Mr Mackenzie added “Paramount offers terrific value for money. Plus, homebuyers at Paramount will also receive a fencing and landscaping bonus, so they can get into their new homes quicker!”.

“A range of quick and easy transport options are also within easy reach, including trains, buses, freeway and bike path. And if it’s recreation you want, Paramount is a short drive away from fishing, swimming, boating, bushwalking and picnics at some of Western Australia’s most beautiful beaches.”

BUY NOW WHILE THESE GREAT SITES ARE AVAILABLE!

Paramount Private Estate Baldivis offers elevated, family-sized blocks with views with 480sqm lots available from $185,000! This is amazingly good value for larger sized lots, which makes it easy to understand why they are getting snapped up!

Contact Andrew Mackenzie, our friendly Estate Sales Manager on 0419 904 790 or andrew@spatialproperty.com.auto find out more.

What the federal election result means for the property market. Kate Burke, Journalist, June 2019

A shorter, shallower property price downturn could be on the cards on the back of the Coalition’s victory at the polls, experts say.

Following months of uncertainty about the impact of tax changes, which had led to greater wariness in the cooling market, experts are revising their views on property prices, market activity and first-home buyers.

Property prices

“It’s pretty clear to us that the bottom [of the market] is just around the corner,” Commonwealth Bank senior economist Gareth Aird said.

With reforms to negative gearing and the capital gains tax off the table, a likely interest rate cut on the horizon and a scheme to encourage first-home buyer activity, it was reasonable to think prices would not fall much further.”

He expected prices to bottom out late this year but noted it would not be a sharp recovery due to tighter lending standards.

 

Market activity

Regardless of the outcome, market activity was always likely to pick up post-election as buyers and sellers would have more certainty on housing policy.

We are now expecting a more gradual pick-up in prices, with both first-home buyers and investors to drive market activity on the back of the Coalition’s policies.

Domain economist Trent Wiltshire said “Sellers will respond to buyer interest and there might be a few people who were thinking about selling who have held off [until now].”

Well-attended auctions are a positive sign of buyer interest. Ray White Chairman, Brian White, said, “buyers and sellers would be relieved to know where they stood now the election was over.

[In the lead-up] people were saying ‘let’s sit on our hands and just wait and see what’s happens’. That waiting is finished and I think there’s a big chance that confidence will get a nice boost, as we’ve seen already in the stock markets.”

While he is not expecting to see a rush to market, he believes there will be a boost from buyers and sellers who had been waiting on the sidelines.

“I’m confident the market will now improve, because of the stronger [market] curiosity exhibited by the community, which has been reflected by increased auction attendances,” Mr White said.

“People are all wanting to know what’s coming … I believe we’ll look back and sees this period as the bottom of the market.”

McGrath chief executive, Geoff Lucas, agreed the government’s win would inject confidence and clarity back into the market.

 

First-home buyers

Labour’s proposed changes to negative gearing and the capital gains tax discount would have removed concessions for investors, creating a more level playing field for first-home buyers.

The changes aimed at improving housing affordability will not go ahead under the Morrison government. Instead, first-home buyers will have access to a loan scheme — also backed by Labour — enabling them to purchase property with a 5 per cent deposit.

AMP Capital Chief Economist, Shane Oliver, expects the policy will bring forward some first-home buyer activity, but that its impact will be limited as it is capped at 10,000 loans a year and requires a higher debt-to-income ratio.

He expects the government will morph the scheme into a grant, which could provide more of a stimulus to the lower end of the market.

While he would not advocate for grants in a booming market as they could further drive up prices, Dr Oliver said it could help in a cooling market when there was concern about the wider impact a downturn could have on the economy.

Mr Wiltshire expected the scheme would have a small but not-insignificant impact and encourage some first-home buyers to get into the market earlier.

However, he noted a Coalition government also meant first-home buyers would not benefit from improved affordability off the back of cuts to negative gearing and the capital gains tax discount.

Andrew Mackenzie, Estate Sales Manager at Paramount Private Estate Baldivis, said that he was relieved that the federal election had resulted in a Coalition win.

“Although I’m not a politically vocal person, I know that both buyers and agents were worried about the election and what it might have meant for the property market.  It’s already been a tough few years for WA and it would have been terrible to see a further decline in prices.

However, since the election, what we are seeing instead is some real positive sentiment from homebuyers, builders and the property market in general.  Although first home buyers have been worried about affordability for some time, the Perth market is currently seeing some excellent examples of housing affordability.

The first land release at Paramount represents amazing value for homebuyers at $172,000 for a bigger, elevated 450sqm block, with views to the hills. Plus, as part of an overarching, masterplan community, it will include its own primary school, shops, public open spaces and aged care facility.”

Mr Mackenzie also said that Spatial Property Group had ensured that the pricing at Paramount Private Estate Baldivis was not only very competitive, but it also offered homebuyers terrific value for money. On top of the excellent pricing, Paramount will also provide homebuyers with fencing and landscaping bonuses, so they can get into their new home quicker!

 

 

Paramount is situated at the southern end of Baldivis Road, and rises westward towards the ocean.  From its elevated position on the ocean-side, Paramount is destined to become Baldivis’ premier land development, with stunning views over bushland and to the hills.

It’s easy to imagine living in a beautiful new home that’s surrounded by parks and natural bushland, only a short distance from great schools, shopping centres and all your amenities.

A range of quick and easy transport options are also within easy reach, including trains, buses, freeway and bike path. And if it’s recreation you want, Paramount is a short drive away from fishing, swimming, boating, bushwalking and picnics at some of Western Australia’s most beautiful beaches.

THE BEST TIME TO BUY IS NOW BEFORE PRICE RISES NEXT YEAR OR SOONER!

Paramount Private Estate Baldivis offers 450sqm premium, elevated, family-sized blocks with views starting from as little as $172,000!  This is amazingly affordable, no wonder we’ve now sold over 25% of Stage 1!

 Contact Andrew Mackenzie, our friendly Estate Sales Manager on 0419 904 790 or andrew@spatialproperty.com.aubefore they’re all sold out!