Election result a good outcome for property, but more needs to be done say industry bodies
While parts of Australia are reeling from Saturday’s election result, the property industry has welcomed the outcome.
Reiwa president Damian Collins said the Coalition’s victory meant there would be no change to national property taxes, like negative gearing and capital gains tax, which was a big win for the Australian housing market and would go a long way towards helping the WA market recover.
“We are delighted there will be no changes to national property taxes,” he said.
“Meddling with one component of a broader tax system is reckless and would have had significant consequences for the Australian housing market.
“This outcome will provide much needed stability for the WA property market.”
Urban Development Institute of Australia (UDIA) president Darren Cooper said while there was little doubt the policies of the Liberal-National Coalition were more conducive to a vibrant property development sector, there were still many improvements that could be made
“UDIA applauds the Government’s commitment to housing affordability and creating more liveable cities through its record $100 billion commitment to infrastructure over the next decade, as well as initiatives such as the First Home Loan Deposit Scheme,” he said.
“However, the real key now to enabling new home ownership is for the Government to unlock housing credit.
“It can best do this by encouraging APRA to reduce its interest rate servicing benchmark rate, that the banks must use to assess home loan applications.
“The current assessment rate of 7 per cent is unrealistic in the current interest rate environment, and by reducing peoples’ borrowing capacity it’s locking thousands out of buying their first home, or upgrading or down-sizing from their current home.
“Even a benchmark rate of 5.5 per cent would provide a prudent buffer over current rates, and would get home lending and therefore housing markets moving again.
Both organisations will continue to champion a range of issues to help the national and state property market.
The UDIA will advocate for:
1. Getting populations settings right
2. Delivering urban infrastructure
3. Boosting housing supply & diversity
4. Reforming taxes and charges
5. Improving clarity and certainty; and
6. Future-proofing our cities
“Although a Liberal-National Coalition government is positive for our industry, we believe there are still many improvements which can be made and we will continue to advocate for these on behalf of our members around the country,” Mr Cooper said.
Reiwa sought to ensure WA was not forgotten when national policies were implemented.
“It’s time we got our fair share of federal funding and support,” Mr Collins said.
“In particular, we’d like to see the Morrison Government introduce federal incentives to help states and territories phase out stamp duty.”
Last month, Reiwa spoke to the Prime Minister about his party’s plans to help the WA property market.
It said his response was WA had already been given a greater share of Australia’s GST revenue and these additional funds should be used to look into how to abolish stamp duty and reinvigorate our local market.
“The WA property market is crying out for some definitive leadership to help aid recovery and improve our local economy,” he said.
“Regardless of whether the responsibility for this change comes at a state or federal level, we need action now.
“In addition, Reiwa would like to see Perth put back on the Regional Migration Scheme to help attract skilled workers to WA and fill the current oversupply of housing, and we want a minimum 15 per cent infrastructure budget implemented, based on WA’s substantial contribution to Australia’s GSP.
“We also need the new Minister for Cities to have a Perth City Deal as a top priority.”