- ANZ/Property Council survey showed confidence surged to 142 points
- Queensland making a comeback from extreme lows during height of pandemic
- South Australia recorded the strongest increase in a year
- Victoria experiencing a slow recovery in confidence, but medium-term outlook is positive
- Western Australia remains the strongest in the nation for property industry confidence
With the Australian economy making a wonderful recovery, and coming out of the pandemic better than many other developed nations, the property industry across the nation has surged away.
According to the ANZ/Property Council survey for the March quarter, the national industry confidence surged to 142 points, the second-highest level since the survey began (a score of 100 is considered ‘neutral’).
Property Council of Australia chief executive Ken Morrison said rising confidence was being driven by record-high economic growth expectations.
“When the property industry is confident, it is exceptional news for the entire national economy because it employs so many people, more than 1.4 million Australians,” Mr Morrison said.
“While the economy still faces significant challenges, the property industry is clearly buoyed by the speed of our turnaround and the strong demand they are seeing, particularly in the residential and industrial sectors.”
Ken Morrison, Property Council of Australia Chief Executive
Queensland surging from extreme lows
Despite the slower than anticipated return of workers to major business precincts, Queensland’s property sector confidence surged from 124 points in the December 2020 quarter to 144 points this latest quarter.
These are phenomenal results, considering that at the height of the pandemic in March last year, the state recorded a low of 58 index points.
This confidence is only expected to increase, especially considering that a raft of restrictions was relaxed across the state this morning.
“The results highlight a remarkable recovery for Queensland’s property sector, which proved resilient throughout the challenges of last year and is now spearheading the State’s economic recovery,” said Property Council’s Queensland Executive Director, Chris Mountfield.
“Over the coming months, the Property Council will be working with its members, Brisbane City Council and the Queensland Government, to implement a plan to support our city centre and ensure it continues to drive Queensland’s economy.”
Chris Mountfield, Property Council Queensland Executive Director
South Australia records its biggest increase in a year
Statewide property industry confidence in South Australia sits at 142 for the March quarter, up 14 points since last quarter.
This is only 7 points below the strongest result on record for the state, and is the strongest increase in 12 months.
“Despite some sections of the business community still facing a period of uncertainty, this data reveals an extraordinary recovery given what the community faced last year,” said Property Council’s SA Executive Director, Daniel Gannon.
“Over the past 12 months, we’ve learned a lot about business innovation and organisational nimbleness. Here in South Australia, we are comparatively safe, healthy, and resilient, we’re getting back to business and reopening our economy as confidence continues to lift.”
Daniel Gannon, Property Council South Australia Executive Director
Victoria staging a slower recovery
However, the recovery in confidence was not so rosy in Victoria. The state recorded the lowest in the nation at 124 points for the March quarter.
However, the medium-term outlook is turning positive, with Victorians optimistic that the COVID-19 situation will improve over the next three months.
The Property Council’s Victorian Executive Director, Danni Hunter said the positive medium-term outlook should be leveraged by the Government and private sector to stimulate economic recovery.
“Government should partner with the private sector in a concerted effort to encourage workers back into Melbourne’s CBD which will generate growth across the local and state economy, by stimulating consumer activity.”
“Every one office worker generates enough activity to support the employment of another five people in our CBDs. Melbourne’s CBD represents 24 percent of Victoria’s economy and 7 percent of Australia’s economy. It is vital for Melbourne to resume to its pre-COVID glory.”
Danni Hunter, Property Council Victoria Executive Director
Western Australia the strongest in the nation
Meanwhile, WA recorded the most positive outlook in the nation, rising to 157 points, up from a score of 133 in December 2020.
The WA property industry clearly has a lot of confidence in the current direction, the newly re-elected McGowan Government and the state’s ability to weather the storm of COVID-19.
When asked to nominate the most critical issues for the state government, WA respondents prioritised property taxes and charges, vibrant city centres, and housing supply and affordability.
The Property Council’s WA Executive Director Sandra Brewer said the 75% stamp duty rebate for off-the-plan apartments, which is set to expire in October, has encouraged much-needed development and provided greater housing choice – and should become permanent.
“Making this a permanent tax concession will act as a long-term incentive, rather than just a short-term sugar hit. The residential construction industry, supported by HomeBuilder and complementary state government stimulus, was the workhorse of our state’s economy last year.”
“A report published by NHFIC found every $1 million spent on residential development generates nine full-time jobs.”
Sandra Brewer, Property Council Western Australia Executive Director
This recommendation mirrors that of REIWA’s President, Damian Collins, who has had this reform at the top of his agenda list since before the WA state election.
“We firmly believe that without this ongoing incentive, the demand for WA apartments will soften, impacting the steady supply of diverse housing and the creation of jobs for West Australians,” Mr Collins argued back in February.