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Confidence in Queensland’s property sector falls for first time in nearly 2 years

Confidence in Queensland’s property sector falls for first time in nearly 2 years

CONFIDENCE in Queensland’s property sector has fallen for the first time in nearly two years on the back of the latest tax grab proposed by the state government, a new survey reveals.

CONFIDENCE in Queensland’s property market has fallen for the first time in nearly two years on the back of the latest tax grab proposed by the state government.

The ANZ/Property Council Survey released today, taken in the weeks either side of the November state election, has recorded a drop of two index points for Queensland in the March 2018 quarter — the first decline in 20 months.

The state now has the lowest confidence levels of all Australian jurisdictions.

The re-elected Palaszczuk Government has announced plans to increase land tax rates by 2.5 per cent on properties worth more than $10 million and more than double the tax rate for foreign investors from 3 to 7 per cent.

Property Council Queensland executive director Chris Mountford said the results confirmed industry concern about the proposed property tax hikes, which he argued would hurt jobs growth and home values.

“At a time when we need to do more to catch up with other markets, increasing taxes on property is a big economic risk,” Mr Mountford said.

“The impact of these proposed tax increases can already be seen in the figures.

“Forward work schedules, staffing level expectations, and Queensland’s economic growth predictions are all down.”

The ANZ/Property Council Survey Queensland results for the March quarter of 2018.Source: The Courier-Mail

The ANZ/Property Council Survey Queensland results for the March quarter of 2018.Source: The Courier-Mail

The Property Council is urging the Government to reverse the proposed tax increases, saying ordinary Queenslanders would pay the price because businesses would be forced to pass on the cost to consumers.

“The proposed land tax hike is ultimately going to flow through to affect capital values, and impose higher rents and costs on businesses,” he said.

“I think there’s a general lack of understanding that foreign buyers are a key ingredient to getting new housing construction starts going.

“If we’re making it harder for those people to invest in Queensland, ultimately that’s going to flow through to lower levels of activity.”

The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Photo: Glenn Hunt/Getty Images. Source: Getty Images

The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Photo: Glenn Hunt/Getty Images. Source: Getty Images

For the last two years, Queensland has consistently lagged behind the major states when it comes to confidence, only remaining in front of Western Australia, where the end of the resources boom created significant economic challenges.

But the latest survey shows a surge in confidence in WA.

“Clearly confidence is starting to return to the WA market,” Mr Mountford said.

“They’ve turned a corner and yet we haven’t had that sentiment shift.

“If anything, we’re still bumbling along behind the other states.”

New homes under construction in Mango Hill, north of Brisbane. The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Image: AAP/Dan Peled. Source: AAP

New homes under construction in Mango Hill, north of Brisbane. The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Image: AAP/Dan Peled. Source: AAP

But ANZ senior economist Daniel Gradwell said that he was not too concerned about the confidence drop in Queensland during the quarter,

“Overall sentiment is still sitting at pretty solid levels, even though it has dropped off recently,” Mr Gradwell said.

“I think it’s fair to say Queensland has essentially moved past its mining-related downturn.

“We’re starting to see economic activity improve, particularly across the labour market with unemployment at its lowest level in about four years.

“So confidence is already translating into actual economic activity.”

The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Photo: Glenn Hunt/Getty Images.Source: Getty Images

The latest ANZ/Property Council Survey shows a drop in confidence in the Queensland property industry. Photo: Glenn Hunt/Getty Images.Source: Getty Images

St George Economics noted in its latest economic outlook for Queensland that the state’s economic growth had picked up over the past year, with business investment gaining momentum, commercial construction strengthening and robust employment growth.

Nationally, the survey reveals New South Wales has lost its throne to Victoria as the property industry with the strongest outlook.

It gathered responses from 1374 professionals within the residential and commercial property sector.

“It’s a large sample size, so we’re confident it’s reflective of what’s actually happening on the ground,” Mr Gradwell said.

Originally published: www.news.com.au

Opinion

Little movement on HTW residential property clock in April

residential property

Herron Todd White have released their April property clock, and there has been little movement in the residential sector.

Broome and Canberra were the only locations to change their position on the clock in terms of residential housing values, with both regions moving to ‘rising market’.

There were also few changes to the property clock for the residential unit market last month, with the biggest shift being Canberra moving to a declining market.

oowoomba units shifted to ‘start of recovery’ and Emerald is now classified as a ‘rising market’.

The residential property clock

Top of the clock:

Houses – Albury, Bathurst, Burnie/Devonport, Dubbo, Launceston, and Tamworth’s housing values all remain at the peak of the market.

Units – The best-performing unit markets include five of the same locations that featured at the top for houses: Albury, Bathurst, Burnie/Devonport, Launceston, and Tamworth.

Starting to decline

Houses – Wodonga

Units – Wodonga

Declining market

Canberra’s unit market was the only area classified as in decline.

Approaching bottom of the market

No areas

Bottom of the market

Houses – Albany, Geraldton, and Kalgoorlie remain at the bottom of the market.

Units – Albany, Geraldton, and Kalgoorlie all make another appearance for units, along with Sydney and the Whitsunday region.

Start of recovery 

Houses – Alice Springs, Bundaberg, and Darwin’s housing markets were all classified as being at the start of their recovery.

Units – Alice Springs, Brisbane, Bundaberg, Cairns, Canberra, Darwin, Emerald, Ipswich, Melbourne, Perth, South West WA, Toowoomba, and Townsville’s unit markets are also starting to recover.

Rising market

Houses – Once again, it’s a crowded field on the rising market end of the clock, with Adelaide, Adelaide Hills, Ballina/Byron Bay, Barossa Valley, Brisbane, Broome, Cairns, Canberra, Central Coast, Coffs Harbour, Emerald, Gladstone, Gold Coast, Hervey Bay, Hobart, Illawarra, Ipswich, Karratha, Lismore, Mackay, Melbourne, Mildura, Mount Gambier, Newcastle, Perth, Port Hedland, Rockhampton, Shepparton, South West WA, Southern Highlands, Sunshine Coast, Sydney, Toowoomba, Townsville, and Whitsunday housing markets all on the rise.

Units – Adelaide, Adelaide Hills, Ballina/Byron Bay, Barossa Valley, Broome, Coffs Harbour, Dubbo, Gladstone, Gold Coast, Hervey Bay, Hobart, Illawarra, Karratha, Lismore, Mackay, Mildura, Mt Gambier, Newcastle, Port Hedland, Rockhampton, Shepparton, Southern Highlands, and the Sunshine Coast’s unit markets were all classified as rising.

Approaching peak of the market

Geelong was the only location classed as approaching the peak of the market for both houses and units.

 

Article Source: eliteagent.com

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Opinion

Is now a good time to buy property? Nearly 40 per cent of people think so, despite record house prices

house prices

House prices are at historical highs, records tumble every weekend at real estates auctions around the country and price growth rates continue to rise.

Despite those facts, nearly 40 per cent of Australians believe that now is a good time to buy.

According to new research from the financial comparison website Canstar, 38 per cent of those surveyed believed that it was a good idea to buy property now.

Canstar group executive financial services Steve Mickenbecker said that of those who thought it was a good time to buy, many were expecting prices to continue to rise. They also cited low interest rates as another reason.

“Either way there will be no shortage of buyers as sellers come out,” he said.

“Today the market is overwhelmed with buyers, auctions are intensely competitive, open houses crowded, and unconditional contracts are becoming the norm. Low housing supply on the market has intensified the fear of missing out. We are in a low interest rate frenzy.”

Of the 39 per cent who said they didn’t think now was a good time to buy, 45 per cent said the market was currently in a bubble, inflated or under-supplied.

Mr Mickenbecker said the almost-equal number of respondents who said it was a good time and a bad time to buy indicated the rapid growth was slowing down.

“The Reserve Bank and APRA are likely to welcome a leading indicator of a return to balance, tempering growth and discouraging bank excess, but at the same time strong enough to support sustainable economic growth that won’t implode,” he said.

“The Reserve Bank doesn’t want to hurt the broader economy with higher interest rates and currency and is hoping for healthy property prices to support spending, but at a slower pace, so first-home buyers can afford to stay in the race.”

The latest quarterly Domain House Price Report, released last week, found price growth had hit a 32-year high in March.

Sydney’s median house price for the last quarter was $1.3 million, and Melbourne’s reached a record high of $975,000. Hobart’s was just above $600,000, and prices in Canberra grew 20 per cent in a year to a median of $930,000.

Brisbane and Adelaide’s median house prices were at their highest ever, and Perth’s was at its highest since December 2015. Darwin’s median house price was at its highest since December 2017.

CoreLogic figures released this week showed the rapid growth had started to slow, but prices continued to grow in every capital city and regional market in April.

“First-home buyers have been anything but deterred from the market and have leapt in with gusto, encouraged by government incentives,” Mr Mickenbecker said. “They are increasingly competing with investors able to make unconditional offers and blow them away at auctions, and would clearly welcome a more stable market.

“The market continues unabated for now, but a slow and steady future is hopefully ahead of us.”

 

Article Source: www.domain.com.au

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Opinion

CoreLogic: Home values continue to rise but the pace of growth loses steam in April

Home values

Australian housing values lifted by 1.8% in April according to CoreLogic’s national home value index, with the monthly pace of capital gains easing from a 32-year high in March (2.8%).  Although growth conditions have slowed, housing values are still rising at a rapid pace, up 6.8% over the past three months to be 10.2% higher than the COVID low in September last year.

CoreLogic’s research director, Tim Lawless, says the pace of capital gains could slow further over the coming months as inventory levels rise and affordability constraints dampen housing demand.

“The slowdown in housing value appreciation is unsurprising given the rapid rate of growth seen over the past six months, especially in the context of subdued wages growth.  With housing prices rising faster than incomes, it’s likely price sensitive sectors of the market, such as first home buyers and lower income households, are finding it harder to save for a deposit and transactional costs.”

Home values

Home values

 

There is already some evidence of fewer first time buyers in the market, with the Australian Bureau of Statistics reporting a -4.0% fall in the value of first home buyer home loans through February, the first drop since May last year.

Despite the slowdown, positive housing market conditions remain geographically broad-based with every capital city and ‘rest-of-state’ region continuing to record a lift in dwelling values over the month.   Darwin (2.7%) and Sydney (2.4%) recorded the largest month-on-month rise in dwelling values, while Perth values recorded the lowest rate of growth amongst the capital cities at 0.8%.

The four smallest capital cities recorded double digit annual growth (Adelaide 10.3%, Hobart 13.8%, Darwin 15.3% and Canberra 14.2%), reflecting a smaller COVID-related disruption and an earlier start to the growth phase last year.  Melbourne is recording the lowest level of annual growth (2.2%) due to a larger downturn, attributable to the extended lockdown period last year.

The broad trend of houses outperforming the unit sector continued through April as higher density styles of housing experienced less demand amidst elevated supply across some inner city precincts.  At the combined capital city level house values (8.6%) have risen at double the pace of unit values (4.3%) over the first four months of the year.

“A preference shift away from higher density housing during a global pandemic is understandable, however a rise in flexible working arrangements also seems to be supporting greater demand for houses around the outer-fringes of capital cities.  Relatively weak investor activity, compounded by a supply overhang in some high-rise precincts, is also dampening price growth in unit markets,” Mr Lawless said.

Home values

 

 

Article Source: www.corelogic.com.au

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