- Recession fears remain, warned REINSW CEO Tim McKibbin
- The property is being relied on more than any other, he said
- Long term plans are needed to boost economy post lockdown
Longer-term plans to support the economy are needed post-lockdown to help the economy, despite the strong performance of the housing market, warns the President of the Real Estate Institute of New South Wales (REINSW), Tim McKibbin.
In terms of the Reserve Bank (RBA) monthly meeting – which will be held this morning – Mr McKibbin believes that while recent GDP figures saw an economic expansion in June, recessions fears remain, therefore a monetary policy change is unlikely.
“We see no cause for the RBA to deviate from its previously stated plan to leave interest rates steady for the medium term.
“Low rates and affordable finance have been one of various demand drivers for residential property and it’s well-recognised how important a healthy property market is to the economy.”
Tim McKibbin, REINSW
While labelling the property industry as the sector that has been – and will be – relied on for the heavy lifting of the economy, he noted supply issues could end this.
“Of course, there is no need in the market to encourage more demand. Unless we unlock more supply, the economic engine that is the housing market will start running out of steam.”
Addressing broader macroeconomic concerns, Mr McKibbin noted the New South Wales government’s plan for the 70% double dose vaccination threshold for when greater freedoms are expected, but said the economy won’t bounce back as quickly as hoped due to many in the state who are struggling financially.
He is pushing for a long-term economic plan, referring to the Infrastructure Australia report released last week.
“Among the recommendations is a re-examination of the planning approach in Sydney and other major capitals, in recognition that our infrastructure needs have changed as a result of the pandemic, not least because so many of us are working from home,” he said.
“There’s no quick fix and there are many factors to balance in planning the future needs of our cities and their citizens. But there’s also urgency.
“More homes are needed now to meet demand, to give buyers and renters choice, and to keep the wheels of the housing market turning for the greater economic good.”
