Tasmanian property industry’s confidence drops even further

Confidence within Tasmania’s biggest private sector industry has dropped another 12 index points for the June quarter and is the lowest in the country.

The decline in sentiment is against the national trend.

The third Property Council-ANZ Property Industry Confidence Survey, released today, has revealed increasing confidence in every state and territory in Australia except Tasmania and Victoria, which is stable.

Tasmanian Executive Director of the Property Council of Australia, Mary Massina, says the result was a real concern for the Government, as it directly affected forward development decision-making, which would impact on jobs and investment that are desperately needed in Tasmania.

“This is our third survey in the series and it shows that Tasmania’s confidence sits at negative 73, representing a staggering drop of 12 index points,” Ms Massina says.

“The key issues of state economic growth, staffing levels and forward construction levels show that the state’s biggest private sector industry is doing it extremely tough, which dramatically impacts on Tasmania’s economy.”

“These three leading indicators dramatically highlight the worsening environment that the property industry faces against a backdrop of other states and territories gaining momentum and confidence."

“Respondents don’t see the state economic growth improving - in fact, expectations have dropped significantly by 38 index points to sit at negative 66 index points.”

“In line with the continual slide in confidence, respondents are expecting that staffing levels will also decrease, indicating rising property sector unemployment feeding into what is already the highest unemployment rate in the country.”

ANZ Head of Property Research, Paul Braddick, says Tasmanians’ pessimistic view of property markets reflects weak economy activity through 2011.

“A subdued outlook for the Tasmanian economy for 2012, and weak construction activity expectations, presents some further downside risk to Tasmania’s property industry through 2012,” Mr Braddick says.

Ms Massina says the property industry’s view of forward construction work expectations was again the lowest in the country, with expectations that capital values across residential, office, industrial and tourism would decrease – again, out of line with expectations across the other states and territories.

“There is absolutely no doubt where the property industry saw the Government’s performance on planning and managing growth, with 85.5 per cent of respondents rating it poorly,” she says.

“This confidence survey comes on the back of the Government’s refusal to rule out increasing property taxes and fees in the upcoming budget.”

“Currently mum-and-dad investors through to institutional and private investors pay 36.7 per cent or $333 million of the total state taxation revenue.”

“That’s also not taking into account the broad based property tax - council rates - which saw $500 million paid to 29 councils.”

“The property industry wants more than the Government’s rhetoric on key micro-economic reforms such as planning, water and sewerage, local government and tax – we need to see commitment and delivery.”

“The Labor Green Government should recognise the property industry for what it is – 45,000 hard-working Tasmanians who pay taxes, buy houses, send their kids to school and who are vital to Tasmania’s economy.”

“They deserve recognition and support.”

propertyoz.com.au/confidence