REA having a bear market rally?, page-7

A few counters to your points to consider.

1. "Real estate is one of the asset classes with the most anchoring bias. Sellers would hate selling below their purchasing price or their "perceived worth". I believe in that scenario advertised volume will head south"

That may be true, but that will only be true for people who has bought in the last few months. If that represents only a fraction of current homeowners, it's not going to stop the large volume of other sellers who probably saw 30%+ rises over the last 12 months. Mortgage stress will also add to forced selling.

2. "Australian market is unique because the transaction cost with stamp duty is ridiculous. House flipping is less prevalent than in the States. I think that is one of the other reasons sellers will go on strike if the prices are too low."

Stamp duty laws could change in NSW which will only accelerate transactions. This is currently a proposed legislative change. Will be a huge growth driver for REA. With no changes, we still have the status Quo.

3. "This is high multiple equities which every way you look at"

It is, but the multiple should be relative to growth. They have expanded into India which could be a 10x opportunity assuming they grow as they have done here. They also have the mortgage business, and complete pricing power in the current market. Given the huge margins they have, any rise in input costs can more than be offset by price rises given their market position. This is easily absorbed given houses prices have gone up on average over $100k in median capital cities. What's another $1k rise to get to that $100k?

4. "DON"T FIGHT THE FED. This is one like getting into a boxing ring with Mr. Tyson in his prime. You lose every time and probably lose half a ear lobe in the process."

While I agree with your general point, it assumes you and I both know what the Fed is going to do. We simply do not. The balance of probabilities say higher rates, but what if inflation tapers off? We have record savings rates, a strong consumer and high house prices. That's a lot of upside for REA if we are wrong on our Fed predictions.