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Demand and Supply

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Astrid Amado

on 8 March 2016

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Transcript of Demand and Supply

Property collapse in mining towns
Demand and Supply
Mining Boom
House prices in Moranbah 2012
Opportunity Cost
Opportunity Cost = Explicit Cost + Implicit Cost
Conclusion
-Factors Affecting the boom: Discussion backed by Graphs.

-Factors Affecting the Bust: Discussion backed by Graphs.

-Opportunity Cost calculated based on the median price of a house.

-The Group acknowledges that such a case study, in order to be covered in depth might need a lengthy article.

Video
Introduction
Mining Boom
New job ads in Moranbah Jan 2007 to Jan 2012
Mining Boom
Coal and Crude Price
Mining Bust
House prices in Moranbah 2015
Mining Bust
New job ads in Moranbah 2014
Mining Bust
Coal and Crude Price
Presented by:
Mohamad Tiba
Matthew Morrison
Huw Davies
Astrid Amado

For: Jeremy Neguyen
ECO80001-Economics

Swinburne University

Metropolitan Median Prices from Dec 2005 to Dec 2015

Melbourne Median house price growth 2012 to 2015
= approx 11% growth p.a. (compounding)
$720,000 in Melbourne Dec 2012 = approx $984,000 in Dec 2015
That’s just taking the average!
$590,000 (actual capital loss)
+ $264,000 Implicit Cost (potential growth)
= $854,000
Total Opportunity cost
Video - Study Case
Mining Boom
Mining Bust
Opportunity Cost
Moranbah, QLD

source: https://www.realestate.com.au/neighbourhoods/moranbah-4744-qld
source: https://www.realestate.com.au/neighbourhoods/moranbah-4744-qld
source: http://www.seek.com.au/Content/Images/other/NewsAndMedia_Mar2014.png
source: http://www.seek.com.au/Content/Images/other/NewsAndMedia_Mar2014.png
source: http://www.reiv.com.au/property-data/median-prices
-Increasing Coal price from 2009 to peak in 2011/12
-After peak demand in 2012, House and unit prices in Moranbah in rapid decline
-As mining related employment increases, so does demand for housing in local areas
-Demand for housing in Moranbah rapidly increasing from 2009 - 2012
-Peak job demand in Mining centers experiences rapid decline from 2012 - 2014
-Oversupply and increased competition globally contribute to rapid Coal price decline.
source: http://www.carbonbrief.org/is-cheap-coal-bad-news-for-the-climate
source: http://www.carbonbrief.org/is-cheap-coal-bad-news-for-the-climate
References

-https://www.realestate.com.au/neighbourhoods/moranbah-4744-qld
-http://www.seek.com.au/Content/Images/other/NewsAndMedia_Mar2014.png
-http://www.reiv.com.au/property-data/median-prices
-http://www.carbonbrief.org/is-cheap-coal-bad-news-for-the-climate
https://www.centralbank.ie/publications/Documents/08RT12.pdf
Last accessed: 06/03/2016 
http://www.landecon.cam.ac.uk/research/real-estate-and-urban-analysis/centres/ccepp/copy_of_ccepp-publications/wp02-13.pdf
Last accessed: 06/03/2016‎ 
http://www.ahuri.edu.au/__data/assets/pdf_file/0015/2049/AHURI_Final_Report_No165_The_drivers_of_supply_and_demand_in_Australias_rural_and_regional_centres.pdf
Last accessed: 06/03/2016‎
https://www.centralbank.ie/publications/Documents/08RT12.pdf
Last accessed: 06/03/2016 
http://www.landecon.cam.ac.uk/research/real-estate-and-urban-analysis/centres/ccepp/copy_of_ccepp-publications/wp02-13.pdf
Last accessed: 06/03/2016‎ 
http://www.ahuri.edu.au/__data/assets/pdf_file/0015/2049/AHURI_Final_Report_No165_The_drivers_of_supply_and_demand_in_Australias_rural_and_regional_centres.pdf
Last accessed: 06/03/2016‎
-An exemplar of the boom and bust
-main focus: Economic Factors Explosion
Implosion
-Boom, Bust, and Opportunity Cost
-Housing bubble repercussion…Why?
-Specific environment of each region
-Drivers for Demand & Supply vary
-Pacey Economics, Inc.
“HOUSING MARKET ANALYSIS Supply and Demand”
Full transcript