- REINSW calls upon all levels of government to identify innovation solutions to housing woes
- Argues supply is key to solving affordability issues
- Said stable interest rates makes it a better time than ever to review supply
With interest rates likely to remain low for some time, the Real Estate Institute of New South Wales (REINSW) CEO, Tim McKibbin, has called upon all levels of government to identify ways to increase supply and tackle housing affordability.
Mr McKibbin argues that property buyers are far more sophisticated than they were a quarter of a century ago.
“People have different priorities and preferences, not just when it comes to their home but also their lifestyle, which means both Governments and the market must offer greater flexibility through a broader range of solutions,” Mr McKibbin said.
“Supply is the key to tackling the affordability issue but to meet contemporary needs, this supply must be realised in diverse ways, to offer choice when it comes to housing typology, access to transport and amenity, price points, lifestyle factors and more.”
Tim McKibbin, REINSW CEO
With a low-interest rate environment likely in place for the medium term, Mr McKibbin argues there will be relative stability in regards to income influences impacting the real estate market. Therefore, he believes it is the right time to address innovation on the supply side “which is where affordability can effectively be addressed.”
For the second half of the year, Mr McKibbin expects the market to remain strong – although a Finder survey reveals over half of experts believe prices will peak this year.
“Some commentators have suggested a market correction is coming but we believe the likelihood of this is low,” Mr McKibbin added.
“Price growth may be easing, as the market has largely absorbed the stimulus from low interest rates and the lack of supply, but mild increases remain on the agenda.”
As predicted, the Reserve Bank kept the cash rate on hold today – an important element of macroeconomic stability, suggests Mr McKibbin.
“With the economic fundamentals remaining stable, we expect the market to remain strong ,” he said.
REINSW has called for reform on the supply side of the real estate market, such as improved planning processes.
Nonetheless, he argues housing affordability remains the real issue.
“Of course, for those looking to enter the market, housing affordability remains a real issue. It’s time to get creative on the supply side to meet the needs of today’s discerning property consumers.”