Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Steve Hayes from First National Nerang expects the local property market to weaken over the remainder of 2011, on the back of a falling market over the first half of the year. “This will create ideal conditions for investors to capitalise on lower house prices, increasing rents and improved yields,” Mr Hayes said in the First National Property Market Mid Year Update 2011 released this week. “Restrictive bank lending criteria is holding back the property market as banks adjust their risk profiles for further falls in prices. Even though now is an ideal time to purchase, people are holding onto their money and waiting to see what will happen to the market, property values, the economy and the world.” Mr Hayes said in the main, property prices across all segments (house, apartment/strata and land) are expected to fall, with decreases of between 5 and 10 per cent. He believes the rental market is expected to strengthen slightly, although vacancy rates will flatten out, with movements between 1 and 5 per cent, while weekly rents will trend upwards, increasing by between 5 and 10 per cent. “Increasing rents will hold the rental market up to some extent,” Mr Hayes said. Growth is expected to come from Upgraders, representing the strongest growth in activity in the Nerang region with better rental yields and easing of banking lending criteria driving anticipated investor growth of between 1 and 5 per cent. 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,” Mr Hayes said. “A carbon tax may decrease demand for homes that are not currently adapted for energy efficiency.”
Mr Hayes considers Stamp Duty should be abolished altogether, delivering on the promise to remove all indirect taxes such as Stamp Duty, when the GST was introduced. “But, replacing stamp duty with another form of tax, such as a broad-based land tax or death duties is also not supported,” Mr Hayes said. “A broad-based land tax including the family home would ultimately become a tax on tenants and it would reduce investor interest in Queensland. “Death duties should also be taken off the negotiating table, and any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these proposed policy changes from the recently announced Queensland state budget may be an indication that the Government does not intend to take such matters any further. - copy ends – Issued by: First National Real Estate. For further information or to receive a copy of the 2011 Property Outlook, Steve Hayes from First National Nerang, on 07 5596 0055