Property sector confidence up, concerns remain: PCA

The latest Property Council Survey conducted by the Property Council of Australia (PCA) has revealed that industry confidence among Property Council members has held steady, with the Confidence Index rising by 1 point to 114 index points.

According to PCA, a score of 100 points in the Confidence Index is considered to be “neutral”.

Furthermore, house price growth expectations continued to increase, reaching 40.4 points on the index, reaching the highest level since the 2021 December quarter, and sitting above the historical average of 11.9 (a score of 0 is considered “neutral”).

The survey also revealed that 43 per cent of participants on a national level indicated that housing supply and affordability was the “most pressing concern” for the Australian government, up by 2 per cent and nearing record levels.

On a state level, housing supply and affordability was the primary critical issue for state governments for 46 per cent of respondents, up by 3 per cent, followed by planning and regulation reform at 22 per cent.

Mike Zorbas, PCA chief executive, said while the industry remains broadly optimistic, inconsistent planning regimes and “almost monthly tax hikes” around Australia are “clouding the outlook”.

“While it is pleasing to see consistency of industry confidence, it is clear that housing supply and affordability continues to be a concern for industry experts just as it will remain a decisive issue, alongside immigration, at the next federal election,” Mr Zorbas said.

“Construction activity for the residential sector is below its historical average, and with the federal government targeting 1.2 million homes by 2029, we simply need to up our game on planning reform and housing delivery.”

Mr Zorbas added that the “merry-go-round of rushed taxes” from the NSW and Victorian state governments continue to jeopardise housing supply and industry confidence at a time of consistently high input and investment costs”.

“Likewise, the federal government needs to boost skilled migration into the construction industry and our national care economy to support housing and the living sector, especially retirement living,” Mr Zorbas concluded.

“To increase our run rate of housing across the board and better deliver government services, high-amenity living choices like retirement communities and purpose-built student accommodation need greater government support in 2024.”

The PCA recently welcomed the Build to Rent support for foreign investors, it also called for further measures to encourage additional foreign investment and help reach the government’s 1.2 million home building target by 2029.

Mr Zorbas said at the time that the program has the potential to create 150,000 homes over the next 10 years, however, the “settings must be right”.

[RELATED: Foreign investor changes ‘won’t solve the housing crisis’]