According to the ANZ-Property Council survey for the March quarter, firms are “considerably” more optimistic around the outlook for the property sector this year.
Confidence reached a two-year high with 31 per cent of respondents expecting conditions in the property market to improve over the next 12 months.
Commenting on the results, ANZ highlighted that the outlook is quite mixed across the states; NSW leads the way while Western Australia is still being impacted by the negative effects of declining mining investment.
Respondents in Queensland reported a more positive state economic outlook as well as general rising capital values over the next year.
Further, ANZ said that most of the improved outlook for the property market came from the residential segment.
“Stronger price growth expectations are largely in line with recent results in the housing market,” the bank said. “House prices have returned to double-digit annual growth rates across Sydney and Melbourne… coupled with the returning presence of investors, it appears that demand for housing is reasonably steady at an elevated level.”
ANZ chief economist Richard Yetsenga commented: “Our solid outlook for the Australian economy in 2017 is broadly consistent with the strong tone to this quarter’s survey. Sentiment in NSW', Victoria’s and the ACT’s property markets sits around record levels, in line with the transition away from mining-led growth.”
NSW property industry leads the nation
Property Council NSW executive director Jane Fitzgerald emphasised that NSW had a strong 2016 and the next 12 months are looking positive for the state, with high expectations for growth, investment and hiring.
“NSW industry confidence leads the nation at 149 index points, up from 142 last quarter and is at six-year highs,” Ms Fitzgerald pointed out.
However, Ms Fitzgerald said that more needs to be done to strengthen the housing supply pipeline in NSW, particularly in regards to stamp duty.
“We must cut stamp duty for families trying to get a foot in the property market, scrap the foreign investment tax and continue steps towards streamlining the planning system so that we can continue to build the NSW of the future,” she said.
“The budget is in surplus and there is a record spend in infrastructure – now is the time to ease the tax burden on home buyers and strengthen housing supply. We must not rest on our laurels – there is much more that can be done.”