August - September 2020
W
ith an election drawing closer and only partial policy announcements to date coming from the major parties, Colliers International’s latest monthly research report, released today, looks at sales activity and confidence surveys coinciding with the past six elections since 2000 to showcase what impacts the campaign could have upon the property sector. Ian Little, Associate Director of Research at Colliers, says the analysis found residential sales activity has generally varied little from prior trends, except when a significant government property-related policy was in the limelight. “In five election campaigns out of the six since 2000 there has been little influence on sales activity. However, the one exception was the 2014 election campaign. “In 2014, Labour promoted a Capital Gains Tax and restrictions on the ability of 64
propertyandbuild.com
How elections can change the property sector The 2020 general election could have a major influence on the market, according to a Colliers analysis of election impacts over the past two decades overseas entities to purchase residential property. “These policies contrasted with National’s, which were viewed as supporting the status quo. This divergence saw a slowing of sales prior to the election date and a surge following it when the emergence of a National government removed uncertainty in outcomes.” Little says the prospect of potential changes to housing policy will, in most cases, influence the residential investor sector to a greater extent than own-
er-occupiers. By way of example, total mortgage lending to investors increased from $1.167 billion in August 2014, a month prior to the election, to $1.421 billion in October, an increase of 21 per cent. The uplift for first home buyers and other types of owner-occupiers was just 8.6 per cent. Market dynamics during other campaigns post-2000 have been influenced more significantly by regulatory, economic, financial and demographic drivers such as changes to LVRs, interest
rates, access to finance, migration and the availability of housing. “It is interesting to note that the recent removal of LVR restrictions and a further reduction in interest rates have resulted in investors and first home buyers lifting their share of mortgage lending, despite the current economic backdrop,” Little says. “Looking ahead to the 2020 election, the lack of ‘restrictive’ housing policies and regulatory changes that have been announced, to date lead us to believe that
