Today in property: don't call recovery yet, land prices inflated, "home ownership better than super"
Will Albo pass the mandated tax changes when federal parliament resumes in July?
The positivity party continued yesterday, with HSBC's predictions of a second half 2019 property price plateau dominating headlines for a second day today. Chief economist Paul Bloxham cited APRA's move on the loan serviceability buffer, pending Reserve Bank rate cut and the incoming First Home Buyer Loan Scheme when he said "(G)iven the recent supportive measures, we forecast housing prices to be flat to a small rise (0-4 per cent) in 2020."
Corelogic residential researcher Cameron Kusher said yesterday it's too early to tell if these factors are affecting actual sales, particularly as none of these changes have happened yet. But he did say real estate agents are reporting higher levels of inquiry.
SQM Research MD Louis Christopher was also calling for level heads yesterday, saying "I'm not surprised there's more confidence in the housing market, but you need to be careful."
One group lapping up the optimism is land developers, who need these measures to work. RPM Real Estate Group has released figures showing prices in Melbourne's land market have remained steady despite sharp drops in sales - but said incentives from developers and builders have created an "artificial floor" for land pricing.
An early indicator that better times are coming their way was presented by CBA chief executive Matt Comyn, who said incoming home loan applications jumped to a 10-month high in the week following the election. NAB, Westpac and ANZ also recorded marked increases in loan inquiries last week.
Speaking at a business lunch in Sydney yesterday, Mr Comyn took the opportunity to opine that lower taxes and policies will be much more effective in stimulating the economy than a Reserve Bank rate cut. True or not, it's exactly what you'd expect a banker to say.
Freshly-minted leader of the federal opposition, Anthony Albanese's ears must be burning on that score. He's under pressure to support Scott Morrison's three-stage income tax cut package when parliament resumes in July...he was on record last week saying he doesn't think the full three stages should be approved.
If the increase in leisure and business travel spending since the election is anything to go by, we're already spending the money. Accor's Simon McGrath said hotel bookings jumped in the week following, and the local head of Norwegian Cruise Lines, Steve Odell also saw a big pick-up in inquiries.
We've seen a few articles pop up today offering saving advice for would-be first home buyers. This piece from the SMH is a little smug, but it does have some good ideas. There's also this from abc.net.au talking about why children are living with their parents longer - which immediately made me think of Tyler Durden in Fight Club. Lastly, the Centre for Independent Studies has come out saying compulsory superannuation for Australian millennials is bad policy; we should be helping them buy a house instead.