Uncertainty in the Federal political environment, combined with increasing concern about domestic economic conditions, continues to harm ACT property sector confidence, with new research showing a negative outlook for the industry.
The latest Property Council of Australia-ANZ Property Industry Confidence Survey shows a shift in sentiment from 85 on the index for the September quarter to 92 for the December quarter. A score of 100 on the index is considered neutral.
The quarterly survey polled more than 3500 property industry professionals across all Australian states and territories on their forward-looking views regarding the business and political environment, the economy, employment intentions and other factors.
Property Council ACT Executive Director, Catherine Carter, says the latest Survey shows ACT continues to have the lowest sentiment of any mainland state or territory.
ANZ Head of Property Research, Paul Braddick, says ACT respondents maintained a negative view of the property sector for the December quarter.
“A score of 92 on the index reflects a soft economic outlook for the ACT,” Mr Braddick says.
“With existing budget pressures, the potential for public sector job losses in 2013 and a sharp unwinding of the 2011 dwelling construction boom weighing on the ACT economic outlook, respondents revealed the second weakest confidence index across all states and territories in the December quarter.”
Ms Carter says the Survey found politics continues to be the dominant factor influencing sentiment in the ACT property industry.
A total of 62.4 percent of respondents believe the federal political environment to be an impediment to business-making decisions for the next 12 months. The domestic economic environment (52.6 percent) and state political environment (45.1 percent) were the next most important factors.
All of these measures had increased over the previous quarter.
Ms Carter says the Survey results again prove the ACT’s economic health and the Federal Government were directly linked, and reinforced the need for the ACT Government to broaden its revenue base.
“The ACT Government has adopted the need for a long-term tax reform plan, while at the same time increasing property taxes it promised to abolish,” Ms Carter says. “You don’t reform bad taxes by increasing them.”
“Tax reform should encourage investors to commit capital that generates job growth, economic growth and social capital.”
“Increasing taxes on major investors, especially those creating jobs and generating economic activity in the Territory, undermines this goal.”
“We won’t believe the ACT Government is serious about tax modernisation until it reverses its recent stamp duty increase and gets rid of other taxes it promised to abolish, such as commence-and-complete fees for commercial, mixed-use and multi-unit residential developments.”
Catherine Carter, Executive Director ACT, Property Council of Australia
Ph: 0412 330 079
Paul Braddick, Head of Property Research, ANZ
Ph: 03 9273 5987