Industry group calls for stamp duty reinvestment
Industry group calls for stamp duty reinvestment
Posted on Wednesday, October 29 2014 at 3:21 PM
The Real Estate Institute of New South Wales (REINSW) says its State Government should support first homebuyers with stamp duty revenues.
According to John
Cunningham, deputy president of the REINSW, Office of State Revenue figures indicate
stamp duty paid on residential property sales has
risen $500 million compared to the September quarter in 2013.
“This is already more than double
the June State Budget forecast of a $200 million increase in stamp duty revenue
for the entire 2014/15 financial year.”
Cunningham says the proceeds should
go towards reinstating first homeowner grants for established property, which
is preferred by first-time buyers.
While stimulation of the
construction industry was among the planned benefits of restricting grants to new
housing only, Cunningham says the approach is failing.
“By
offering grants on new builds only, they’re pitting first homebuyers against cashed
up investors and as well as foreign investors.”
The REINSW
has also called for a review of the stamp duty thresholds.
“There has
never been a review of the transfer duty thresholds in NSW to recognise bracket
creep.
“The
current two lowest transfer duty thresholds in NSW have been in place since 18
December 1974 – 39 years – while the other thresholds (apart from the premium
property duty) have been in place since 18 December 1986, some 27 years.”
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Stormy forecast a wake-up call for strata scheme residents
Posted on Monday, October 27 2014 at 2:14 PM
With the storm season fast approaching for Australia’s north-eastern coasts, thousands of unit owners throughout Queensland are being urged by peak industry body Strata Community Australia (SCA) to begin planning for what could well be a tumultuous storm season.
“Bodies Corporate need to ensure that things
such as the condition of rooves are checked and that gutters and drain pipes
are kept clear,” president of SCA (Qld) Simon Barnard says.
“Tree branches close to units and apartments
should be removed and loose items around the property need to be secured. It’s
also very important for Bodies Corporate to review their property’s storm
insurance to make sure they’re fully covered.”
The industry body for strata and community title
management in the sunshine state Strata Community Australia (Qld) is backing a
warning from the state Community Recovery and Resilience Minister David
Crisafulli for people to start preparing emergency plans before the potentially
destructive weather hits.
He points out that homeowners and residents
throughout Queensland should be doing everything they can to prepare for
possible heavy storms and cyclones. “This includes determining where you and
your family will go if forced to evacuate and ensuring you have enough food,
water and supplies to last at least three days,” Barnard says.
The Bureau of Meteorology has indicated that up
to four cyclones will form this storm season and at least one could cross the
coast. Severe storms have also been predicted along with flooding in some parts
of the state.
“Just because a property is insured for storm
damage, it doesn’t necessarily mean it’s also covered for related incidents
such as flooding, landslides, or personal injury,” he adds.
“It’s also important to remember that strata
scheme policies do not cover your contents and personal items.”
New statistics released by the Queensland
Department of Justice and Attorney-General show a three per cent growth in the
last year for strata titled lots across the state. There are now more than
43,000 community titles schemes with 409,000 community titled lots in
Queensland. The Queensland Plan released earlier this year also echoes this
surge in high-density development and has been predicted to carry the strata
industry in Queensland to upwards of $100 billion in replacement value over the
next decade.
Barnard goes on to say: “Northern Queensland
residents will be happy to know that the strata building resilience project has
completed the first 100 assessments in North Queensland. The initiative is
focused on improving resilience to severe weather so that customers can receive
sustainable premium reductions.
“So far, more than 3,000 lot owners have
benefited from the assessments with an average saving of 11 per cent with
policy renewal, or through a credit if the customer’s policy has been renewed
since the project commenced in April.”
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Sydney’s vacancy rates fall
Sydney’s vacancy rates fall
Posted on Friday, October 24 2014 at 3:42 PM
Residential rental accommodation availability in Sydney has slipped, according to data released by the Real Estate Institute of New South Wales.
The September 2014 REINSW Vacancy Rate Survey saw the
number of properties for rent across Sydney fall 0.1 per cent to 1.7 per cent.
REINSW president
Malcolm Gunning says rental vacancies have declined across Sydney, with outer
Sydney seeing the largest decline hitting a 10-month low.
“Outer Sydney vacancy
rates dropped 0.2 per cent to 1.4 per cent, while middle Sydney fell 0.3 per
cent to 1.9 per cent and inner Sydney remained steady at 1.8 per cent,” he
says.
The Hunter region was
down 0.2 per cent at 3.1 per cent on the back of a 0.8 per cent fall in vacancy
rates in Newcastle at 1.9 per cent. This is the lowest level for Newcastle
since September 2013.
The mid-north coast was the hardest place to
find rental accommodation in regional areas at 1.4 per cent, down 0.2 per cent.
Central Coast fell 0.3 per cent to 1.7 per cent,
Albury was down 0.1 per cent at 1.6 per cent, and the Riverina dropped 0.6 per
cent to 2.8 per cent. Northern Rivers declined 1.0 per cent to 2.7 per cent.
The Central west went against the trend, which
jumped 0.5 per cent to 4.3 per cent.
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Australian house price growth slows
Australian house price growth slows
Posted on Thursday, October 23 2014 at 9:39 AM
Analysis by the Domain Group shows the nation’s capital city housing markets have generally softened over the September quarter this year.
The organisation’s House Price Report reveals the
national median house price increased by only 1.2 per cent over the quarter.
Andrew Wilson, a senior economist with the
Domain Group, says the result represents the first retreat in the numbers since
early 2013.
“The national house price result is the lowest
quarterly growth rate recorded since March last year and continues to be
primarily reliant on the strength of the Sydney market.”
Sydney, Melbourne and Darwin all recorded price
growth for the quarter, however Brisbane, Adelaide and Hobart saw a fall in
their median house prices.
“Although
house prices in Sydney are not accelerating at the exceptional levels recorded
last year, the growth rate has been consistent over 2014.
“The Sydney market
will continue to lead the pack, however, the clock is now ticking for that
market as further signs of moderation are emerging,”
Wilson says the results
for Brisbane were particularly unexpected.
“Surprisingly, the
Brisbane house price stalled over the September quarter with the median down by
1.3 per cent, which is the first negative quarterly result for more than two
years.
“Adelaide and Hobart also reversed recent trends of house price growth,
recording their first falls in a year.”
During the September quarter, Perth and Canberra
saw respective falls of 1.5 per cent and 1.7 per cent in their median house
prices.
“Subdued prices growth in Perth was no real
surprise as that market has consistently reported waning buyer activity over
the past year,” Wilson says.
Meanwhile in Darwin, prices rose sharply by 2.9
per cent.
“Volatility in Canberra and Darwin is also a
continuation of recent market trends,” he says.
In terms of units, the analysis revealed Sydney
and Adelaide were the only two capitals to see price gains during the period.
Wilson says policymakers need to take heed of
the numbers.
“Without a sustained revival in economic
activity, housing markets will continue to soften, ending the debate about macro-prudential
tools or changes to property taxation policy designed to offset local and foreign
investor activity.”
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Figures show NSW is fighting back
Figures show NSW is fighting back
Posted on Monday, October 20 2014 at 12:45 PM
Figures released by the Australian Bureau of Statistics (ABS) today show a weaker June 2014 quarter but a strong fiscal year for new dwelling commencements in New South Wales, Housing Industry Association (HIA) executive director David Bare says.
“Despite a pull-back in new dwelling
commencements in the June 2014 quarter, the 2013/14 fiscal year was still the
strongest NSW had experienced in a decade,” he says. “Last year NSW started
46,715 dwellings, comprising 20,999 detached houses (up 16.1 per cent) and
25,716 multi units (up16.2 per cent).
“The strong result for 2013/14 confirms the
important role new home building is playing in an economic revival for NSW,”
Bare explains.
“After so many years of underbuilding it will
be important to see further growth in new residential construction in 2014/15.
That will require further policy support from the NSW Government to complement
the current low interest rate environment.”
Total seasonally
adjusted dwelling commencements amounted to 10,874 in NSW in the June 2014
quarter, a decline of 12.3 per cent on the previous three-month period.
Detached house commencements fell by 6.0 per cent in the June 2014 quarter,
implying a drop of 17.7 per cent in multi units.
NSW is a new leader at
the top of Australia’s economic performance ranking, according to CommSec,
which analyses key indictors (economic growth, retail spending, equipment
investment, unemployment, construction work done, population growth, housing
finance and dwelling commencements) to find out how the Australian states and
territories are doing in comparison with each other. NSW is top of rankings on
population growth and dwelling starts and second on retail trade, business
investment and unemployment. The state is also third on housing finance and
fourth on overall construction work and economic growth.
According to CommSec’s figures, in four of the
states and territories – Western Australia,
Victoria, NSW and the ACT – trend housing finance commitments are above decade
averages. And in six of the eight economies, trend commitments in August were
above year-ago levels in all states and territories.
The Property
Council of Australia’s NSW executive director Glenn Byres says: “The economic
renaissance in NSW is powerful and has been underpinned by a healthy home construction
market.
“A mix of
well-targeted incentives, infrastructure investment, lower borrowing costs and
favourable market conditions has helped NSW achieve its best housing starts in
a decade.”
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Building activity hits 20-year high
Building activity hits 20-year high
Posted on Thursday, October 16 2014 at 10:36 AM
The Housing Industry Association (HIA) says the home-building recovery has brought activity to its highest level in 20 years based on recent Australian Bureau of Statistics data.
With home starts topping 180,000, Shane
Garrick, chief economist at HIA, has welcomed the result.
“Back in early 2012 when activity was so low,
the prospect of breaking through 180,000 starts within a couple of years was
beyond almost everybody’s most optimistic expectations.”
Despite the record outcome, Garrick says it’s
disappointing the same sort of figures didn’t translate across all housing
construction.
“The multi-unit dwelling segment saw a sharp
fall during the second quarter of this year, with detached house building also
nudging down a little.
“On the renovation side, the volume of work
done also fell, with a three per cent reduction in activity during the June
2014 quarter.”
HIA analysis indicated new housing starts
will need to reach around 186,000 annually between now and 2050 to meet
requirements.
“Even in such a strong upturn, we are still short of this requirement today,” Garrick says.
“This is a stark illustration of the serious
supply-side issues which will need addressing.”
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Concerns over rise of safety responsibilities for property managers
Posted on Tuesday, October 14 2014 at 3:39 PM
The Real Estate Institute of New South Wales (REINSW) has recognised that there are mounting concerns with the increase in safety responsibility outside the core function of property management, with CEO Tim McKibbin commenting on the escalation of legal obligations associated with property managers over recent years.
“Property managers are now expected to have competencies and express an
opinion as to the integrity and respective safety of a broad range of building
and safety issues including glass, asbestos, window safety locks, smoke alarms,
decks and balconies as well as swimming pools, and this is not an exhaustive
list,” he says.
“This extension of duties and responsibilities is a growing concern for
the Institute.”
Property inspection company PropertySafe’s managing director Phil Oakes
agrees, adding that the levels of injuries and, sadly, deaths in residential
homes, whether they are owner-occupied or tenanted, are simply too high.
“We’re proud to have entered into a strategic relationship with REINSW
to address these issues,” he says.
“With the proper education involving the key stakeholders, we believe
that the growing trend can be reversed. This can be achieved by identifying any
safety hazards in the property and ensuring that ongoing maintenance is well
managed.
“The statistics on injuries, deaths and claims are alarming, especially
when the vast majority are avoidable with very little cost for the landlord.
“The family home is supposed to be a safe environment. If an accident
occurs the impact is devastating for all those involved.
“For rental properties this also has a big impact on the landlord and
property manager, potentially both emotionally and financially.
“With the assistance of REINSW, we’ll be running workshops to show real
estate professionals how they can regain control.”
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Rumours of a boom greatly exaggerated
Rumours of a boom greatly exaggerated
Posted on Wednesday, October 08 2014 at 4:36 PM
One industry group has raised concerns the thriving Sydney property market is driving commentary and policy for all Australian real estate.
The Housing Industry Association (HIA) has released analysis suggesting
not all markets are operating at the same level.
The HIA’s A
Portrait of Australian Home Prices report says after accounting for
inflation, capital gains have been subdued across most capitals.
“In real terms,
dwelling price growth has been at a single-digit rate in every capital city
over the past year, with the exception of Sydney.
“Outside of Sydney and
Melbourne, real dwelling price growth was just 2.2 per cent in the year to June
2014.”
The report also notes
housing affordability has remained reasonably flat across most markets.
“For example, in
Sydney the dwelling price to household earnings ratio is about the same as a
decade ago, but has increased over the past two years.
“In Melbourne and the
other six capital cities, the ratio is lower than it was four years ago.”
The analysis is in
response to suggestions policy should be introduced to slow the housing boom,
with the HIA highlighting most commentary is too general.
“…much of the
public discourse around the current housing price cycle tends to
over-generalise and imply that strong growth is considerably more widespread
than is actually the case.”
The HIA notes that price growth and transaction volumes have
been strong in Sydney and Melbourne.
“It is also the case that these two capitals combine to
account for around 40 per cent of Australia’s population.
“That leaves about 60 per cent of the population where home price
growth is relatively modest, as exemplified by the
analysis in this paper.”
A copy of the report can be found here.
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Interest rates are staying put, for now
Interest rates are staying put, for now
Posted on Tuesday, October 07 2014 at 2:25 PM
Property investors and homeowners have heaved a small sigh of relief after the Reserve Bank of Australia (RBA) today announced that, once again, the cash rate will be staying exactly where it is for at least another month.
The rate has been
sitting at a historically low 2.5 per cent since August 2013, having been cut
twice the beginning of 2013. The last time it rose was in November 2010 (by
0.25 per cent).
RBA governor
Glenn Stevens made the monthly announcement today, explaining that despite
volatility in some financial markets picking up in recent weeks, “overall…
financial conditions remain very accommodative. Long-term interest rates and
risk spreads remain very low. Markets still appear to be attaching a low
probability to any rise in global interest rates or other adverse event over
the period ahead”.
He went on to say
that public spending is scheduled to be subdued in the near future and that,
overall, the RBA still expects growth to be a little below trend for the next
several quarters. He also commented on credit growth, saying that it’s moderate
but has seen a further pick-up in recent months as competition to lend has
increased. On the subject of house prices, he simply made the comment that
dwelling prices have continued to rise over recent months.
There is some
belief that relatively low consumer confidence forced the RBA’s hand.
Mortgage Choice
spokesperson Jessica Darnbrough says: “According to the Westpac Melbourne
Institute of Consumer Sentiment, confidence fell by 4.6 per cent in September.
“This sudden and
disappointing drop in confidence has ultimately forced the RBA to leave the
official cash rate on hold at today’s board meeting.
“While the
Reserve Bank has made it clear in recent weeks that something needs to be done
to cool the property market, it is now unlikely that the board will raise the
cash rate anytime soon as this may further negatively impact consumer
sentiment.”
RP Data’s head of research Tim Lawless believes the softer
reading for housing market conditions during September may have gone some way
to easing some of the concerns of the RBA.
Nevertheless, he adds, “the trend in dwelling values remains
strong, with the RP Data CoreLogic index reporting a relatively sedate 0.1 per
cent rise in capital city dwelling values over the month of September but a
much stronger 2.9 per cent increase over the September quarter”.
He goes on to suggest that the trend rate of growth needs to
be closely monitored, particularly across Sydney and Melbourne, where values
have risen so much more than other cities.
“Investor interest in these markets has been significant
compared with other capital cities and compared with historical ratios of owner
occupier loans to investor loans.
“If investor interest in these markets doesn’t moderate we can expect the RBA,
in conjunction with APRA, to intervene via prudential regulation of the banking
sector to attempt to slow down the level of investment lending activity in the
market. As foreshadowed in remarks from the RBA to a recent Senate Economics
Committee inquiry into affordable housing, such an intervention is likely to
take the form of higher risk weightings (or capital) for investment loans,
although this is unclear at this stage.
“In any event, the goal would be to slow the level of
speculative investment across the housing market, particularly in Sydney and
Melbourne, alleviating the pressure on the RBA to raise interest rates in order
to dampen housing market conditions,” he says.
Citing recent
data that suggests the Australian economy is performing strongly, Darnbrough
adds: “Now is a great time for those with a mortgage to review their home loan
and make sure they are still in the most suitable product for their needs.
“Similarly, if
you would like to get onto the property ladder, now is a good time to do so.”
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Failed football team brings property price bounce
Posted on Wednesday, October 01 2014 at 11:58 AM
Could the solution to lagging home prices be hobbling your city’s major sporting franchise?
Probably
not, but the parallel between a lack of finals fever in Perth and an upswing in
real estate prices has been noted by one commentator.
Data from
the Real Estate Institute of Western Australia (REIWA) shows the metropolitan
median up by almost one per cent to around $544,000 in the three months to
September.
David
Airey, president of REIWA, joked that with no Western Australian team in the
AFL grand final, more people seem to have escaped the television and gone house
hunting.
“Actually,
it’s always the case that September is a slow sales month with Father’s Day,
various sporting finals, the Royal Show and the long weekend interrupting
things.
“Although
there was a pick-up in sales at the end of September, numbers overall for the September
quarter were down by seven per cent on the June quarter and down 15 per cent on
the same time last year.”
Airy says
the Perth market has remained flat most of this year, with the recent rise in
the median reflecting increased activity closer to the CBD.
He also
noted there’s been a softening in activity in outer suburbs.
“This may
be a result of the numbers of first homebuyers slipping away,” he says.
Areas that
saw a pick-up in sales for September included the eastern and western parts of
the City of Stirling, and the cities of Fremantle, Vincent and Melville along
with the Town of Kwinana.
The rental
market remains subdued as well with the vacancy rate at four per cent and a
general softening in rents since June.
“Typical rents for houses have dropped $10
over the last three months to $450 per week, while rents generally for units
and villas have dropped by around $15 since June to about $430 per week,” Airey
says.
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