Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Peter Barrett from First National Real Estate Barrett expects the Copper Coast property market to weaken further over the remainder of 2011, on the back of a falling market throughout the first half of the year due to a lack of demand and reduced consumer confidence. “This creates prime conditions, especially for investors to capitalise on lower house prices, increasing rents and improved yields,” Mr Barrett said in the First National Property Market Mid Year Update 2011 released this week. “Government over-taxing and the threat of increasing interest rates is steadying the market in the coming six months.” According to the Update, in the main, property prices across all segments (house, apartment/strata and land) are expected to trend downwards with movements to be between 5 and 10 per cent. “Reduced demand coupled with a lack of consumer confidence is impacting negatively on property prices,” Mr Barrett said. Mr Barrett believes the rental market is expected to flatten with an over-supply of rental accommodation easing vacancy rates which should increase by between 1 and 5 per cent. “As a result, weekly rents will flatten, with potential for movements of between 1 and 5 per cent,” Mr Barrett said. The Government’s move to introduce a carbon tax is not supported by First National members, primarily as a result of concerns about the impact on confidence, the economy, saleability of existing housing stock, and values. “However, more customers will seek energy efficient features when looking to buy a new home, due to the rising household energy costs and the challenge of maintaining a healthy home budget as energy becomes more expensive, and energy efficiency takes on more significance in the buying decision,” Mr Barrett said. “A carbon tax will also potentially decrease demand for homes that are not currently adapted for energy efficiency.”
Mr Barrett considers Stamp Duty should be abolished altogether, as it only serves to stifle the property market and is an unfair and unequitable tax. “Removing stamp duty from the home purchase equation will make buying a home more affordable,” Mr Barrett said. “But, Stamp Duty should only be abolished, as long as the mooted plans for replacing it with other taxes such as a broad-based land tax, including the family home, or death duties are not carried through. “And any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these proposed policy changes from the recently announced state budget may be an indication that the Government does not intend to take such matters any further. Mr Barrett said, “A key change for the property market, which will impact quite significantly, is the number of local government authorities throughout the state and territory who are amending their planning regulations to allow for higher density developments which should see activity increase.” - copy ends – Issued by: First National Real Estate. For further information or to receive a copy the 2011 Property Outlook, Peter Barrett from First National Real Estate Barrett on 08 8825 3344