“Chris is writing about the spike in public prices, et cetera. He’s not saying it’s going to fold, he’s just talking about the econ-metrics around it. The metrics around the economy. I’ve asked him to stop, but of course he’s a journalist, so he won’t listen to me even though he’s my CEO and I pay his wages, but it doesn’t matter. He keeps writing about the bloody stuff and it aggravates the shit out of me, but what can you do? That stuff, that sentiment calls the Reserve and they get nervous.

What the Reserve Bank has been doing is commenting upon it. The commentary so far is, “Look, it’s okay,” because if you go back to the GDP number … That’s all they’re interested in is growth, what the hell is going to grow in this country? A property construction-driven growth in this country and the growth and wealth we feel as a result of our investments getting higher is very important for people in the household consumption component will have to spend more money to get that number up to three and a half percent and the Reserve Bank knows that.

Without growth in property prices you won’t get developers coming in and adding more supply to the system because ultimately what’s driving these property price increases is not enough supply and more demand. It’s pushing prices up. With more supply it’ll keep prices flat, or in more sustainable growth patterns. To get supply you’ve got to get convince developers to supply more and developers aren’t going to supply more if he’s buying it for a million and he’s only going to sell it for a million. He’s got to buy it for a million and be able to sell it for 1.2, 1.3, depending what he adds to it, does to it.

He’s only going to do that if there’s growth in the prices, in the market, and a little bit of exuberance. The Reserve Bank knows that. If this developer buys a property and he’s going to try and improve it, he’s going to buy sheet rock, he’s going to buy sand, cement, blah, blah, blah, blah, blah, which is going to add to the household consumption number.

It’s going to increase wages and it’s going to keep employment where the Reserve Bank wants it, for all Australians. Anyone in this room who’s invested in property and is being positive about it, is actually helping the Reserve Bank do something and that is looking after the welfare of all Australians.

Without you input and without your positive mood around property, and without you actually doing something like that, executing it, there is no business for people to start spending money on these sorts of inputs like sand and cement and labor, et cetera, which means umemployment drops back, which means consumption drops back, and expenditure drops back, which means people start losing jobs. It’s very important for people like Harry to shut the fuck up. Pardon my French.

This country deserves a positive sentiment. With positive sentiment, everything will go well. It’s all very well for newspapers to do what they do, and what I do myself sometimes, I try not to but the editors are always urging me to do it, so I give you that context. It’s very important for people like you to get out there and make positive contributions to the people you talk to. Spread the good news of good word.

You need to have a series of steps. What I tried to do here today is actually go through a series of steps for you, just so you can logically build on from everything you read, build on the logic of how it is to be configured, how you configured your presentation. How you explain to somebody what it is that they need to hear about, someone who’s less able than you, less informed than you, less experienced than you, but actually wants to have, and is as enthusiastic about it, have the same experience as you, like do well in property. Property still is a very important asset class.

I should stipulate, I should form part of a total portfolio, but when something is in a good environment, a rising tide, things are going well, you should actually probably invest more and more in the rising tide. Clearly you’ve got to know when to hold and when to get out. They are different issues. That’s a different discussion.

In terms of the property market in general, and the economic outlook as it affects property markets and interest rates, as it affects GDP, and how the Reserve Bank interacts with all of those things and configures mathematically, and algorithm to give them an outcome which determines interest rates, and how this statement gets derived every month, is what I wanted to talk to you about today. Thanks very much.”

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Mark Bouris, founder and chairman of Wizard Home Loans presented at the 20th Property Club National Conference.