Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Ans Papini from First National Real Estate Pope Nitschke expects the Mt Barker property market is expected to moderate over the remainder of 2011, on the back of falling market throughout the first half of the year due to a lack of confidence in state and federal governments. “This creates prime conditions, especially for investors to capitalise on lower house prices, increasing rents and improved yields,” Mr Papini said in the First National Property Market Mid Year Update 2011 released this week. “Rising stock levels, together with reasonable buyer demand will help to steady 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 remain relatively flat, with any movements kept to up to 1 per cent. “Price adjustments for houses and apartment/strata properties are needed but will only eventuate when vendor expectations become more realistic, at which time the market will start to move again,” Mr Papini said. “Land prices may drop slightly, by up to 1 per cent with developers reducing prices as a result of lack of sales.” Mr Papini believe the rental market is expected to stabilise with vacancy rates easing and trending upwards, increasing by between 1 and 5 per cent. “Weekly rents will trend upwards, increasing by between 5 and 10 per cent as a result of lesser buyers for purchase being forced into rental accommodation,” Mr Papini said. Growth is expected by Mr Papini to come from investor activity, which is expected to increase by up to 1 per cent. “But, it is Upgraders who are expected to represent the strongest growth in activity for the Mt Barker region,” Mr Papini 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 Papini said. “A carbon tax will also potentially decrease demand for homes that are not currently adapted for energy efficiency.” Mr Papini considered that 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 Papini said. “But Stamp Duty should only be abolished, however, 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 Papini said a key challenge 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, Ans Papini from First National Real Estate Pope Nitschke on 08 8391 5004