Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Dane Stanley from First National Real Estate Mandurah, expects the local property market to steady further for the remainder of 2011, on the back of a moderating market over the first half of the year due to too many bank foreclosures and distressed sellers. “This creates prime conditions, especially for investors to capitalise on lower house prices, increasing rents and improved yields,” Mr Stanley said in the First National Property Market Mid Year Update 2011 released this week. In the main, property prices across the board (house, apartment/strata and land) are expected to flatten, with any movements kept mainly to between 1 and 5 per cent, although house price drops could go to 10 per cent. “Plenty of supply of all property types at the moment has taken some of the heat out of the market which should remain steady even in the light of population growth,” Mr Stanley said. “At some stage, there will be a correction of prices, bringing us in line with the rest of Australia.” Mr Stanley expects the rental market to also remain relatively steady, with vacancy rates and weekly rents flattening out. “Movements will be minimal, up to 1 per cent,” Mr Stanley said. Growth is expected to come from increased investor activity. “Investors are expected to represent the strongest growth in activity, increasing by between 1 and 5 per cent driven by the rising number of home owners being forced into selling their homes,” Mr Stanley said. The Government’s move to introduce a carbon tax is not, in the main, supported by First National members. “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,” Mr Stanley said.
Mr Stanley considers Stamp Duty should be abolished altogether, to stimulate market activity, especially with investors and deliver on the promise of eliminating indirect taxes such as Stamp Duty when the GST was introduced. “However, replacing Stamp Duty with another form of tax, such as a broad-based land tax or death duties should be completely quashed,” Mr Stanley said. “And any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these policy changes from the recently announced WA state budget may be an indication that the Government does not intend to take such matters any further. According to Mr Stanley, the key challenge for the Mandurah property market is the importance placed on the mining sector for the state of WA. “Only 2 to 3 per cent of the total work force is in mining – everyone else is still struggling,” Mr Stanley said. - copy ends – Issued by: First National Real Estate. For further information or to receive a copy of the 2011 Property Outlook, Dane Stanley from First National Real Estate Mandurah on 08 955 4111