Media release – Date BURNIE PROPERTY MARKET STRENGTHENS IN 2012 Deanne Lamprey from First National Real Estate Burnie expects the Burnie property market to be bolstered by renewed interest in 2012, as home buyers stop marking time, after waiting through 2011 for prime buying conditions to arrive. “In the last six months, the market has been falling due to a lack of confidence in the economy and with state government policies, but this is expected to steady in 2012” Ms Lamprey said in the 2012 Property Market Outlook released this week. “With current economic uncertainty, state budget cuts and rising unemployment dampening confidence, house sales and new housing construction will remain slow, with prices generally remaining flat. “It is expected that extended selling periods will be seen and that values will remain under pressure until the region’s economic prospects improve.” Ms Lamprey sees the key challenges facing the region’s property market in 2012 will be ongoing low consumer confidence due to State Government budget cuts to health, education and police. “Stamp duty concessions for first home buyers ceased in the middle of 2011 and this will continue to impact on first home buyers entering the market, as they will need to save a larger deposit,” Ms Lamprey said. “The government also announced in the budget, that spikes in property land taxes will be smoothed out with a reduction in the valuation cycle from 6 years to 3 years. Cost of living increases, such as rising water/sewerage charges and electricity prices, will continue to negate any gains made from high affordability levels.” According to the Outlook, residential property prices in Burnie are expected to remain relatively flat across all sectors although there is potential for some upward movement of below 1 per cent, depending on what happens with interest rates. “A large choice of available properties for purchase in the local Burnie area will continue to ease pressure on prices,” Mr Lamprey said. “Land prices may be sensitive to any decline in building approvals and an oversupply of land in some areas.” The rental market in 2012 could see an easing in rental vacancies, of up to 1 per cent, and moderating rental growth. “Rental markets in areas where job losses are being experienced may experience further easing of rental prices and some price drops in weekly rents will be due to people leaving areas in search of employment,” Ms Lamprey said.
“This could lead to an oversupply of rental properties. So, weekly rental prices will remain relatively flat in those regions, with the potential of some decreases of up to 1 per cent.” Ms Lamprey expects any increases in investor activity to be up to 5 per cent in the main, as economic uncertainty continues to play a role in investment behaviour and purchase decisions. “Any potential increases will only be if investors are able to purchase positively geared properties,” Ms Lamprey said. “But it is the upgrader segment I expect to produce the strongest growth in 2012, as buyers seize the opportunity to capitalise on greater affordability and the possibility of lower interest rates, which are expected to further decrease by between 0.5 and 0.75 per cent. “While interest rate cuts may increase activity slightly in Burnie, the real benefit will be any relief it provides to home owners who are facing large increases in their day-to-day living expenses.” The introduction of the carbon tax is expected to further reduce confidence in the state economy and the government that runs it. On the Commercial Property Market front, Tasmania is currently outperforming all other major office markets and it will continue to set the pace until at least the first half of 2012. - copy ends Issued by: First National Real Estate For further information or to receive a copy of the 2011 Property Outlook, Deanne Lamprey, Principal from First National Real Estate Burnie, on 03 6431 4544