More incentive to go bush
More incentive to go bush
Posted on Thursday, October 31 2013 at 1:59 PM
A program that aims to encourage city slickers to relocate to the bush in New South Wales will be expanded, the government has announced.
The Regional Relocation (Home Buyers Grand) Amendment Bill 2013
was introduced to Parliament yesterday, following an extensive review of the
state’s long-running decentralisation program.
A $7000 cash grant to assist in relocating
to strategic regional areas will become available to more people, with
eligibility now open to long-term renters in metropolitan Sydney, Newcastle and
Wollongong.
“Expansion of the Regional Relocation Grant
will support efforts to ease Sydney’s tight rental market and help to boost
population growth in regional areas,” Deputy Premier Andrew Stoner says.
The legislative amendments will also lead to
the introduction of a new Skilled
Regional Relocation Incentive of $10,000 to encourage people to
move from Sydney, Newcastle and Wollongong to take up employment in regional
NSW.
“The proposals being put forward are
expected to enhance the appeal of regional relocation to a younger,
economically active demographic,” he says.
“Long-term metropolitan renters looking to
relocate to purchase a home in regional NSW or those relocating for employment
will be able to apply for either grant, subject to meeting all the eligibility
criteria, including a minimum distance requirement of 100km for the relocation,
applicable for both grants.”
The new Skilled Regional Relocation Incentive
will be awarded to eligible applicants in two equal parts, with the first
payment triggered three months after the start of employment in the regional
area, and the second to be available one year later.
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Eastland expansion set to overhaul Ringwood
Eastland expansion set to overhaul Ringwood
Posted on Tuesday, October 29 2013 at 11:28 AM
A $575 million development project and a transport upgrade worth $66 million are set to transform the suburb of Ringwood, Victorian Premier Denis Napthine says.
The Ringwood train and bus station will be revamped and 150 stores will
be built, along with a restaurant precinct and a new library and learning
centre.
“This $575 million project will create 1600 jobs during the construction
phase and a further 1700 ongoing retail jobs when the expansion is complete,”
Napthine says.
He says the upgrade will completely renew Ringwood’s city centre and boost
the economy of Melbourne’s eastern suburbs.
The first stage is expected to commence work this month, with completion
flagged for Christmas 2015. The second stage of the development will include a
25,000 square metre office tower and hotel.
Member for Warrandyte Ryan Smith says the project will make Eastland a
state of the art design and community hub.
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Sydney and Melbourne housing markets roar ahead
Sydney and Melbourne housing markets roar ahead
Posted on Thursday, October 24 2013 at 3:41 PM
Median house prices in Sydney and Melbourne continue to rise faster than anywhere else in the country, new data shows.
Figures released today by Australian Property Monitors (APM)
show most capital city markets posted value increases of some sort in the
September quarter.
Overall, the national median house price rose moderately by
2.2 per cent – the fourth consecutive quarterly increase, signaling a sustained
recovery.
The combined capital city median price for units also grew
by a modest 1.2 per cent in the three months to September.
Source: Australian Property Monitors
However it was Sydney that led the charge with a strong 4.2
per cent gain, taking the city’s median house price to $722,718, according to
APM.
“Although the national median house price had a solid
increase over the quarter, this outcome primarily reflects strong contributions
from the Sydney market and, to a lesser extent, the Melbourne market,” APM’s
senior economist Andrew Wilson says.
The median house price in Melbourne rose by 2.2 per cent,
however that market still remains in catch-up mode with its current house price
still nearly two per cent below the peak recorded in June 2010, he says.
On the other end of the spectrum, Sydney’s median house
price is now a whopping 11.6 per cent higher than its precious peak in June
2011.
“The Sydney and Melbourne housing markets will continue to
see solid to strong market activity over the remainder of 2013, with most other
capitals at best recording modest growth.”
Darwin was another strong performer in the three months to
September, with its median house price soaring by five per cent, while Perth
experienced a flat quarter with no change.
Hobart was a surprise performer with a 2.4 per cent median
house price gain, while Canberra experienced a 1.4 per cent fall. Adelaide was
another market to see no movement in the three-month period.
The median house price in Brisbane continued its gradual
increase for the fourth consecutive quarter, rising 0.7 per cent in September.
However year on year, every
major capital market has seen positive house price growth over the course of
2013, with Sydney, Melbourne and Perth leading the charge.
Source: Australian Property Monitors
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Market confidence drops slightly: RP Data
Market confidence drops slightly: RP Data
Posted on Friday, October 25 2013 at 10:06 AM
Housing market confidence has fallen just a tad over the past 12 months, according to a recent survey conducted by RP Data.
The survey revealed 74 per cent of respondents believed it was a good
time to purchase property, down from 76 per cent this time last year.
More than 1000 participants took part in the survey which also indicated
51 per cent were expecting house prices to rise in the next six months,
although they were cautious about the extent of that growth.
RP Data research director Tim Lawless says the most optimistic responses
came from participants in areas where dwellings haven’t shown a substantial
rise in value in the current cycle.
Responses from residents in Sydney and Melbourne were more muted, he
says.
“Clearly Australians remain positive about the direction of dwelling
values, however most respondents who think values will rise over the coming six
and 12 months have fairly measured expectations of value growth with most
suggesting values are likely to rise by less than five per cent over the coming
year,” Lawless says.
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Call to amend negative gearing
Call to amend negative gearing
Posted on Tuesday, October 22 2013 at 9:00 AM
A report into housing policy in Australia has recommended changing negative gearing rules and capital gains tax exemptions to reduce the tax advantages given to investors.
The Gratton report Renovating Housing Policy suggests changing
negative gearing rules so that “investment interest expenses can be deducted
only against investment income earned in that year”.
Under this proposal by economist Saul Eslake, property investors would
be unable to use losses on rental properties to reduce their annual income tax
liability.
Any annual losses may be carried forward and used to offset a capital
gains tax liability, but only when the property is eventually sold, the report
states.
The recommendations follow revelations that tax expenditures for
homeowners adds up to $36 billion a year, while support for residential
property investors costs $6.8 billion a year, adding up to more than 90 per
cent of total benefits.
In addition, the report stated that due to investors competing directly
with potential homebuyers, particularly for established houses, it was harder
for first homebuyers to secure a property.
However, Property Council chief executive officer Peter Verwer says the
report unfairly targets investors and fails to offer alternative solutions to
the issue of housing affordability.
Verwer says the report only looks at one side of the taxation ledger.
“The report focuses on the theoretical tax revenue foregone by
government, it doesn’t net it off against the $34 billion of property taxes
paid each year,” he says.
“The findings in the report, such as the recommendation to tinker with
negative gearing arrangements, fail to look at the benefits of current
arrangements.
“On the basis of the Grattan Institute’s own numbers, negative gearing
provides a source of rental accommodation at a minimal cost to government,
where small investors take all the risk in return for a modest investment
yield,” Verwer says.
“Instead of offering
alternatives that would encourage adequate private rental supply, affordability
and choice, the report takes a lopsided view that undermines many of its own
recommendations.”
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Tenancy changes spell more work for property managers
Posted on Friday, October 18 2013 at 4:06 PM
The implementation of amendments to the South Australian Residential Tenancies Act in early 2014 looks set to impact complying landlords and property managers.
The Real Estate Institute of
South Australia (REISA) is conducting workshops for property managers on the changes,
although the final legislation is yet to be passed into law.
Aaron Havers, a senior property
manager at Harris Property Management, attended a workshop and says the
amendments will include the beefing up of laws surrounding tenancy ‘blacklist’
databases.
Havers says he’s concerned
some bad tenants won’t be listed by property managers due to complexities with
the legislation.
“A lot of agents will just find
the process too hard so they’re not going to bother putting tenants on these
databases anymore.”
The rules have also become
tougher when looking to sell a tenanted property, as landlords will need to inform
the lessee of their intentions.
“We have to explain to owners
that you need to notify the tenant or you could end up with a tenant being able
to walk away from a lease.”
Havers says changes relating
to tenant’s intentions at the end of their lease would prove helpful to
property managers.
“The tenant will now have to
give 28 days’ notice in order to vacate at the end of a fixed term lease
whereas at the moment, if we’re not on the ball following up tenants when their
lease expires, you can be left caught short.
“That gives us four weeks to
re-let the property and find new tenants.”
Peter Wundersitz, principal
at Adelaide Residential Rentals, says the laws will skew slightly in the
tenants’ favour.
“I think that they’ve
probably strengthened the tenant’s position a little bit, which is fine, but
also there are some areas that private landlords are going to have pay some extra
attention to.”
Wundersitz sees the changes
requiring landlords to supply manufacturers’ manuals and operating instructions
for all appliances in a property as an impost.
Difficulties arise when old
appliances, for which manuals can’t be sourced elsewhere, will require new
instructions to be written by a qualified electrician.
“We’re going to have to go
through all of our properties and basically do an audit on everyone.”
Wundersitz says they’re
already undertaking the process of informing landlords on the impact of the
amendments, and he’s found most are unaware of the changes to begin with.
He says property managers in
the industry have been mixed in their reaction to the new rules.
“Some of them have got their
heads around it, some are a bit wound up about it and some are just saying,
‘We’ll just adjust and get used to it.’
“Our initial feeling is that
there is more work involved from our perspective, particularly in relation to
manufacturers’ manuals, the tightening up of lease renewals and the
notification that needs to be given there.”
According to Havers, there
were some changes left out of the document the industry would have liked included.
“We were hoping some things
would go through such as the ability to have a pet bond, because that’s the
case in Western Australia, and they (REISA) were pushing for a reduced time on
sending breach notices, but those (changes) didn’t go through.”
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Vacancy rates remain tight
Vacancy rates remain tight
Posted on Friday, October 18 2013 at 4:08 PM
Vacancy rates across Australia have remained ‘historically tight’, according to data released by the Housing Industry Association (HIA).
The discussion
paper found vacancy rates were likely being impacted by restricted
financing which had delayed home ownership for many households. This has also contributed
to stronger rental price inflation, according to the HIA.
The results released by the HIA showed vacancy rates came under
particular pressure through 2007, with an upsurge in rental inflation
following.
The advent of the GFC saw a loosening of capacity in the rental market,
but vacancies began to tighten again in late 2009.
The current data indicated the number of vacancies has been drifting
upwards, although remained largely steady.
Additional data
released by the Real Estate Institute of New South Wales
(REINSW) revealed a similar prognosis for the Sydney market.
Vacancy rates
tightened in Sydney for the second month in a row, according to the REINSW with
vacancies across the city dropping by 0.3 per cent to 1.7 per cent.
The popular inner
city suburbs were leading the decline, according to REINSW deputy president
Malcolm Gunning.
“September is a busy time for the rental market and
unfortunately it is no surprise that people are finding it more difficult to
find accommodation,” Gunning says.
The results from the September REINSW Vacancy Rate Survey showed the
middle suburbs (within 10 to 25 kilometres of the CBD) remained steady at 1.8
per cent and outer suburbs (more than 25 kilometres from the CBD) fell to 1.5
per cent.
The central
west was the easiest place to find rental accommodation after an increase of
0.3 per cent to 3.8 per cent, while Coffs Harbour, which has been the easiest
location to find rental accommodation for almost two years, dropped 0.6 per
cent to three per cent.
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First homebuyer statistics skewed
First homebuyer statistics skewed
Posted on Wednesday, October 16 2013 at 12:54 PM
The reduction of first homeowner grants could be distorting the statistical drop in first homebuyers, according to Cameron Kusher, a research analyst with RP Data.
Kusher has highlighted suggestions
that many first homebuyers no longer qualify for grants, and so fail to
identify themselves to lenders.
An Australian Bureau
of Statistics officer confirmed their data is collected via lending
institutions, and if borrowers don’t classify themselves as first-time
purchasers, they won’t be recorded.
During a conversation on
Twitter earlier this week, Kusher suggested first homebuyers purchasing an
existing home aren’t bothering to “tick the box”.
“We can’t accurately track
foreign buyers so why would we be able to accurately track FHB (first
homebuyers) without an incentive to do so?” he posted.
The comments were in
response to an article by Leith Van Onselen, chief economist and co-founder of
MacroBusiness.com.au.
Van
Onselen says first homebuyer
demand has continued to soften, despite nominal mortgage rates at near
multi-decade lows, indicating the recovering market is being driven almost
exclusively by investors.
“FHB nationally
slumped by 13 per cent (non-seasonally adjusted) in August and were down 22 per
cent over the year.
“They also
represented just 13.7 per cent of total owner-occupied commitments – the lowest
level since April 2004,” he notes.
Van Onselen says the reduction in
FHB numbers will result in less buyer demand and worsening inequality between
those who own property and those who don’t.
“Western
Australia, the ACT and South Australia have, or are scheduled to, reduce
their grants on pre-existing dwellings, which is yet to feed through to the ABS
data.
“Moreover, higher prices are likely to further ‘choke-off’
FHB demand.”
Kusher believes the lost
government incentives have played a major role in falling FHBs participation,
with legislative changes seeing grants reduced or
scrapped for existing homes throughout Australia.
“Now the idea behind the policy is a good one
because we do need to build more homes, however new stock is often located in
less desirable locations and at higher price points than established stock in
similar, or even sometimes superior, areas.
“So the higher price of the new stock is acting
as a disincentive for FHB to enter into the market and is probably a major
contributor to the falling levels of FHB.”
Kusher says the government would
be loathed to induce further stimulus to the first homebuyer sector, as this
tends to simply increase prices for properties rather than improve affordability.
“If
the government was serious about helping FHB they would look at other ways to
reduce the cost of homes such as increasing supply via expanding the urban
footprints in major cities, moving to a blanket land tax rather than stamp duty,
and reducing the fees and charges associated with the new development of land.”
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New housing numbers on the rise
New housing numbers on the rise
Posted on Monday, October 14 2013 at 11:23 AM
Dwelling commencements increased by 11.2 per cent for the 2012/13 year, according to recent figures released by the Australian Bureau of Statistics.
The increase follows two
years of decline and is being labeled an ‘encouraging recovery’ by Housing
Industry Association chief economist Harley Dale.
“A substantial upward
revision to the March 2013 quarter contributed to housing starts surpassing the
160,000 mark in 2012/13, reaching a level of 161,043. That is a healthy figure
by recent standards and certainly a promising first round recovery for new home
building,” Dale says.
“We now need to see an acceleration of growth in 2013/14
reflective of a broad-based recovery in housing starts. That outcome will
require further upward momentum in New South Wales and Western Australia,
together with a re-emergence of sustained growth in other markets.”
Dale says low interest rates and improved market confidence
would assist with aiding the new housing recovery.
The June 2013 quarter data
shows healthy gains in dwelling commencements in Queensland (up by eight per cent), South Australia (up by six per cent), Western
Australia (up by 11.3 per cent), Tasmania (up by 15.6 per cent), and the Australian
Capital Territory (up by 107.6 per cent). Quarterly declines were recorded in
NSW (down by eight per cent), Victoria (down by 2.2 per cent), and the Northern
Territory (down by 15.1 per cent).
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Dwelling commencements up in 2013
Dwelling commencements up in 2013
Posted on Friday, October 11 2013 at 1:39 PM
New home commencements have risen for the first time in three years, according to the Australian Bureau of Statistics (ABS).
New data released today indicate a gain over the 2012-13 period,
heralding a growing confidence in the property market, Housing Industry
Association chief economist Harley Dale says.
“Dwelling commencements (housing starts) increased by 11.2 per cent in
2012-13, an encouraging recovery following declines of 5.8 per cent and 11.1
per cent in 2010-11 and 2011-12 respectively,” Dale says.
The numbers have broken through an important barrier, he believes.
“A substantial upward revision to the March 2013 quarter contributed to
housing starts surpassing the 160,000 mark in 2012/13, reaching a level of
161,043.
“That is a healthy figure by recent standards and certainly a promising
first round recovery for new home building.”
The data shows strong gains across most states and territories, with the
exceptions being New South Wales, Victoria and the Northern Territory.
Despite the improved national result, Dale says it wasn’t evenly spread
throughout the 12 months, and a more consistent improvement would be welcome.
“What is less encouraging is that all the growth occurred in the first
half of the year, following which housing starts declined in the March 2013 quarter
and held steady in June.
“We now need to see an acceleration of growth in 2013/14 reflective of a
broad-based recovery in housing starts.
“That outcome will require further upward momentum in New South Wales
and Western Australia, together with a re-emergence of sustained growth in
other markets.”
Improving confidence in the sector, combined with low interest rates, should
bode well for a recovery but regulators need to play their part too, he
believes.
“The current regulatory and taxation environment combined with
ever-tightening credit conditions for residential development significantly
dilutes the chances of securing this outcome.”
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