Media Release – [date] 2011 PROPERTY MARKET UPDATE – THE YEAR OF THE INVESTOR
Darren Sparks from First National Real Estate Ulladulla expects the Ulladulla property market to steady for the remainder of 2011, on the back of a falling market over the first half of the year. “This will create an ideal market for investors, who could capitalise on lower house prices, increasing rents and improved yields,” Mr Sparks said in the network’s Property Outlook 2011 Mid Year Update released this week. “Housing affordability, the threat of interest rates increasing, reducing consumer confidence and tight lending criteria from major banks will help to moderate the market in the coming six months.” In the main, property prices across all segments (house, apartment/strata and land) are expected to remain flat, with any movements kept to a maximum of between 1 and 5 per cent, although land prices could potentially fall by as much as between 5 and 10 per cent. Mr Sparks believes the rental market is expected to remain strong, with vacancy rates remaining steady, while weekly rents will trend upwards by as much as between 5 and 10 per cent. According to Mr Sparks, investor activity is expected to increase marginally by up to 1 per cent, but the first home buyer market is expected to represent the strongest growth in activity for the Ulladulla region. 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 Sparks said. “Homeowners will also be more likely to take action to begin correcting the least energy efficient aspects of their property. “Although, this could be an each-way bet, but until the tax is introduced and the impacts felt, it is difficult to predict the outcome on property transactions.”
Mr Sparks considers Stamp Duty should be abolished altogether, as it would promote more efficient use of existing housing stocks. “This should only happen 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,” Mr Sparks said. “And any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these proposed policy changes from the recently announced NSW state budget may be an indication that the Government does not intend to take such matters any further. “It is hoped that the change in NSW government will see some changes in planning policy to enable developers to release more land at a more affordable development cost and with reduced red tape,” Mr Sparks said. “There is, however, a budget loss to be recovered and this may impact on the ability of the new government to effectively move forward with their plans.” - copy ends – Issued by: First National Real Estate. For further information or to receive a copy of the 2011 Property Outlook, Darren Sparks, First National Real Estate Ulladulla on 02 4455 3999