The 2019 federal election has now passed!
The market hates uncertainty, and the coalition win should return confidence to our property markets. The stability of a familiar government, and an expected RBA rate cut in the coming months, will encourage vendors to list their property and see buyers to re-engage with what’s on offer.
The Coalition needs to ensure they are focused on the strength of the property industry that employs one in four Australians. Below, is the real estate sector’s wish list to the new government.
The Coalition government has chosen not to follow the Hayne Royal Commission’s recommendation to cut trailing and upfront commissions for mortgage brokers, instead deciding to review the model in three years. A positive side effect of the royal commission was the improvement in lending standards by our banks to help lessen risk in our banking sector. That said, overregulation and the tightening of standards to a point where businesses, first home buyers and occupiers cannot invest, upgrade or get their foot into the market is a fine line. If taken too far it will not only effect property prices, but also construction levels and jobs. Therefore, the Government now needs to exert its influence and support borrowers by setting a policy platform that encourages banks to free-up finance again.
FIRST HOME BUYERS
First home buyers have been promised some assistance under a Coalition government. It has indicated it will assist by reducing deposit requirements to five per cent without having to take out Lenders’ Mortgage Insurance. The First Home Loan Deposit Scheme is a welcomed measure and will provide a helping hand to those looking to get their foot up in the property ladder. However, this policy and the timing of the announcement shows that housing policy has become an election gimmick, which is only rolled out during the later stages of a tight election campaign. What’s needed from the new government is the consideration, planning and implementation of a comprehensive, long-term housing solution that includes social and affordable housing, build-to-rent, taxation, construction and solutions for all market participants.
The property industry, directly or indirectly, employs one in four Australians; and residential property is valued at $6.3 trillion, making it the most significant sector in our economy. Consequently, and in line with our call for a comprehensive housing policy, the appointment of a federal housing minister is needed to ensure the health of this industry. This minister would have a dedicated portfolio and agency and be charged with improving and implementing effective housing policy. A new housing portfolio created at the federal level would tackle all forms of property policy and strengthen the market through targeted incentives and reform – like other countries such as New Zealand, the United States and UK, which all have dedicated housing portfolios.