Latest DFA/JP Morgan SME Report Launched Today

The latest report, volume 7 of the SME Report series was released today. As well as over-viewing current industry trends, this time we focus on sectoral rotation, with SME’s in the construction industry feeling more confident, whilst other sectors remain patchy. We do not see a significant rise in demand for credit anytime soon.

JPM authored their report using DFA research data as detailed in the DFA SME Report already published and available on request from DFA. Because of compliance issues the final JPM version of the report is only available direct from them.

Go here for more details of our research programmes, and for media requests, go here.


Latest DFA/JP Morgan Mortgage Industry Report Launched Today

The latest report, volume 19 of the Mortgage Industry Report series was released today. As well as over viewing current industry trends, this time we focus on the digital transformation of financial services, and highlight some of the challenges and opportunities for both existing and new players.

JPM authored their report using DFA research data as detailed in the Property Imperative and The Quiet Revolution, both of which are available on request from DFA. Because of compliance issues the final JPM version of the report is only available direct from them.

Go here for more details of our research programmes, and for media requests, go here.



Latest Household Channel Preference Report “The Quiet Revolution” Released

DFA has released its latest report “The Quiet Revolution”, a study of household banking channel preferences, which is available free on request. The report examines preferences across customer segments, and across the sales and service value chains and also looks at how new online players may disrupt the status quo. From the introduction:

QuietRevCover“DFA has just updated the 26,000 strong household survey examining their channel preferences. This report summarises the main findings.

We conclude that the move towards digital channels continues apace, facilitated by new devices including smartphones and tablets, and the rise of “digital natives” – people who are naturally connected.

We outline the findings across each of our household segments, and also introduce our thought experiment, where we tested household’s attitudes to the various existing and emerging brands in the context of digital banking. We found a strong affinity between digital natives and the emerging electronic brands, and a relative swing away from the traditional terrestrial bank players.

These trends create both threat and opportunity. The threat is that traditional channels, especially the branch, become less relevant to digital natives, and becomes the ghetto of older, less connected, less profitable customers. The future lays in the digital channels, where the more profitable and digitally aware already live. Players need to migrate fast, or they will be overtaken by the next generation of digital brands who are looking towards becoming players in financial services. The game is on!”

Request the report [25 pages] using the form below. You should get confirmation your message was sent immediately and you will receive an email with the report attached after a short delay.

Note this will NOT automatically send you our research updates, for that register here. You can find details of our other research programmes here.

New Report – “The Property Imperative III” Launched

DFA released a new and updated edition of the Property Imperative in September 2014. More recent research as featured on this blog, will be incorporated in a revised edition early in 2015.

The-Property-Imperative-III-CoverThis report explores some of the factors in play in the Australian residential property market by looking at the activities of different household groups using our recent primary research, customer segmentation and other available data. It contains:

  • results from the DFA 2014 Household Survey to end August 2014
  • a focus on first time buyer behaviour and ongoing affordability
  • a special feature on loan to income analysis by segment and state.

The report is available free on request, and can be obtained here. More details of our research programme can be found here. Our approach to customer segmentation is described in our recent post, a Segmentation Cookbook.


DFA International House Price Comparison Index

DFA has published its first International House Price Comparison Index. Whilst many reports include international comparisons of property prices, using data from various sources, when you dig into them, often they do not show what you think they might, because the relative scales, and start points are often out of synch, or the data is not reported on the same basis. DFA has gone back to primary sources, including Corelogic and Federal Housing Finance Agency for the US, the Reserve Bank of New Zealand, the Office of National Statistics for the UK, and the Australian Bureau of Statistics to establish a house price index on a comparable basis.

We used data from 2000 as a baseline, and produced a relative movement index from then to the end of 2013, tracking relative movements in house prices over time. The results are in looking at data from the major centres in each country but we also include Sydney as a separate data point because of discussion about the momentum there.

Price-TrendUntil 2004, prices were moving up around average inflation rates, but then we see the US, running up to a peak, prior to the GFC, as markets ran hot, then falling significantly, and is now in recovery. The UK took a hit post the GFC, did not fall as fast, and is recovering now. New Zealand reveals high growth, some correction post GFC, but wins the growth prize relatively speaking, out-performing Australia – one reason why the Reserve Bank of NZ moved to limit credit last year.

Turning to Australia, we see the capital city markets growing relatively consistently, albeit with a GFC induced wobble. We also find the relative growth outside Sydney is higher than in Sydney, because the 2000 baseline there was higher. For example, the median price in Sydney was $310k in 2000, and is now $605k, wheres in Adelaide it was $141k (2000) and is now $395k. Hobart was $104k (2000) and is now $345k and Darwin was $161k (2000) and is now $565k. We can also look at the relative annualised growth rates over the trend period. Darwin is the winner, followed by Hobart and Perth.


So, two observations, first, by international standards, property price growth in Australia is at the high end as I discussed recently, and second, the relative growth has been a lot stronger away from Sydney, yet much of the recent talk has been about a bubble IN Sydney! We see again the impact of the structurally high property prices thanks to poor policy, easy credit and lack of supply. We have a national property problem, not a local Sydney one!

We plan to update our index regularly as new data is published.

Joint JP Morgan and DFA Mortgage Industry Report

The latest Volume 18 of this joint report was released today. We expect to see some media coverage. The entire JP Morgan report is not available via DFA because of the proprietary nature of their material. However, the report contains the household survey data from The Property Imperative Report. This is available on request.

Request the Property Imperative Report