Qld property confidence flat, but high hopes for home prices
HIGH hopes for house prices over the next 12 months have offset subdued confidence in Queensland’s property sector, amid industry unease ahead of the state election.
The latest ANZ/Property Council survey shows sentiment in the sunshine state’s housing sector is the second lowest in the country, with Queenslanders also having the lowest expectations for economic growth.
The Property Council says the industry is uneasy about economic conditions in Queensland ahead the upcoming local and state elections.
“Industry is clearly looking for both local and state governments to step up and put a greater emphasis on unlocking economic activity,” Property Council Queensland executive director Chris Mountford said.
“With the property industry directly accounting for 11.4 per cent of our state’s economic activity and paying 49 per cent of Queensland state and local taxes, policies that support the property sector should be top of the pile during these elections.”
Queensland also received the worst rating for its performance on planning and managing growth.
Despite this, the March 2020 quarter survey shows expectations for home values to increase in Queensland are the highest in five years, with the state scoring 45 out of 50 on the 12-month ahead capital growth expectations index.
ANZ senior economist Felicity Emmett said signs of recovery in the housing market had been emerging for some time, with sentiment turning around convincingly in May.
Ms Emmett said auction clearance rates had improved and housing finance was starting to pick up.
New figures show the value of new housing finance commitments in November increased by 2.5 per cent in Queensland, 0.4 per cent nationally.
“The continued improvement in credit availability suggests the outlook for construction activity, not just prices, should begin to pick up in coming months — initially through a stabilisation and then up-tick in building approvals,” Ms Emmett said.
“Prices are benefiting from a combination of pent-up demand and low stock levels, but we think that the current strong monthly price gains will moderate in 2020 as more supply comes on stream and credit policies stay relatively constrained.”
According to those surveyed, the most important issues for state and territory governments are property taxes and charges, followed by housing supply and affordability, development around transport nodes, and planning and regulation reform.
“Strong house prices help underpin confidence and activity, but without matching housing supply, this can lead to runaway price increases and real housing affordability pressure,” Property Council of Australia chief executive Ken Morrison said.
“Coming off the back of a sustained drop in new housing approvals and construction starts, we must be vigilant to ensure housing supply keeps up with demand, including population growth, as the residential market reboots.
“Governments must be on the front foot in keeping the housing supply lines open and support affordability through better planning and infrastructure delivery.”