Updated: Apr 17, 2019
Let the good times roll! Retail sales jumped a massive 0.8 per cent in February, prompting the Herald’s Jessica Irvine to ask, did we spend this week’s budget stimulus measures before we got them? Whether that’s true or not, Gerry Harvey couldn’t contain his glee as one of the big winners in Tuesday night’s budget. Australia also scored a record $4.8bn trade surplus in February, largely thanks to higher-priced offshore resource sales.
Little wonder then, that the RBA held rates yesterday at their historic 1.5 per cent low for the 29th consecutive month.
Home sales dropped over the December quarter by 31 per cent according to ABS figures, sparking commentary from Propertyology that it’s the credit crunch, not demand, that’s driving the downturn. SQM Research is also showing property listings up significantly across the cap cities (and especially Melbourne).
(As an aside, home sales in Vancouver, Canada have plummeted as a result of the government enacting a foreign buyer’s tax and an empty-property tax. Sound familiar?)
A number of developers are grasping at the fledgling build-to-rent sector as an opportunity, showing support for Labor’s proposal to halve the 30 per cent withholding tax rate on managed investment trusts for rental housing. Labor’s negative gearing proposals aren’t so popular, with Shorten refusing yesterday to budge from his plan to restrict negative gearing tax concessions only to purchasers of new properties. Still not enough meat on that particular bone for any of us to know what to expect.
Back to the budget, and Shorten’s budget reply is tomorrow. He plans to drop more measures to help low-income workers, and go on the offensive on health. The Australian is already calling his measures a magic pudding budget.
Commentary around the budget over the past 24 hours has included:
Assertions by Daily Telegraph that thanks to the budget, young people in Sydney will need to wait to inherit property from dead relatives in order to get into the market.
The government has been criticised for being overly optimistic on wage forecasts. As eagle-eyed readers of this email would’ve seen yesterday, the budget figures were significantly rosier than the RBA’s projections.
AECOM has said better infrastructure planning is needed to deliver the $100bn pipeline.
The states are cranky at the loss of GST revenue heralded in the budget.
…not that any of this captured the nation’s imagination on Tuesday night. Something like 1.25M people tuned in across the ABC and commercial channels to watch the budget announcement; nearly 1.9 million watched Married At First Sight instead.
Speaking of shiny things, Tiffany & Co is on a media blitz this week, with Kendall Jenner coming to Sydney for a new launch. There’s money in them thar hills, apparently. This, when Australians are also expected to drop $2.3bn on active wear this financial year.
If you have a lazy $200m in your pocket, Lotus Group and Euro Properties are flogging their Channel 9 Masterplan site in North Sydney.