Industry experts are forecasting a slowdown in house sales and the number of properties coming onto the market across the six-week federal election campaign, in which housing affordability and rent prices are becoming hot topics.
History shows Australians are usually reluctant to sell or rent during a campaign, but their confidence in the market remains steady, said President of the Real Estate Institute of Australia, Hayden Groves.
The Liberal National Party and Labor both agree on issues such as keeping negative gearing, which is a significant benefit for home buyers, Mr Groves said. A stable and supportive tax environment could help the overall confidence in the market.
This is a significant difference from the 2019 campaign when the major parties differed on banking policy, mortgage broker engagement and property-related tax benefits.
This time around, Mr Groves recommended homebuyers not “put their cue in the rack” or wait until the election was over to act on buying or selling.
“There’s really nothing from either side of the major parties that would be anything other than encouraging participation in the property market,” Mr Groves said.
He said buyers were backing Australia’s housing market, with total investor loan commitments of $10.8 billion in February.
Economist Angus Moore, from the property data website PropTrack, said elections were a headwind for the current property market, but he didn’t expect the campaign to damage buyer confidence.
“Neither party has flagged any major changes to housing policy that will affect first-home buyers’ approach, or investors and existing vendors looking to upgrade,” he said.
The Property Council of Australia Chief Executive, Ken Morrison, released a seven-point plan that includes supporting the elderly with age-friendly housing, unlocking housing supply and boosting affordable housing.
Mr Morrison said the council’s Seven Steps to a Prosperous Australia has been proposed to both sides of politics for many months.
Both major parties have been urged to address the rental crisis following analysis from industry researcher CoreLogic which found investor demand for mortgages remained below the 10-year average.
Investors made up 32.6% of all mortgage applications in February. While this is an increase from January’s 22.9% result, it remains below the decade average of 34.9%.
The national residential vacancy rate fell to a 16-year low of 1.2 per cent in February, according to SQM research.
The Chair of Property Investment Professionals of Australia (PIPA), Nicola McDougall, said the current rent crisis was the result of the longer-term reduction in investor loans.
“Even with our international borders mainly closed over the past year, Sydney’s vacancy rate hit 2% in February with the asking rent for houses soaring 17.1% over the past year,” Ms McDougall told industry magazine, Elite Agent.
“It’s not enough for political parties to offer piecemeal funding for affordable housing when there is a critical undersupply of rental properties.”
If you’re considering buying a home – either to live in or as an investment – don’t let talk of the election put you off getting yourself organised. Feel free to reach out and we can discuss your options and get you ready to act.