NSW confidence softening, but outlook still healthy

Ms Fitzgerald said attention must be paid to assessing what can be done to stabilise industry confidence. 

“In NSW, the property industry has experienced a significant increase in the number of levies and taxes that need to be paid to develop in this state — this will eventually influence the confidence of the market and I think we are beginning to see this.

“Earlier this month we saw a report from NSW Treasury, released under an FOI, warn of the potential consequences of increasing foreign investment taxes including lower housing supply, a drop in government revenue and a negligible impact on home prices; we must be cautious of the potential effect of some of the levers we are pulling.

Ms Fitzgerald said policies to strengthen the housing pipeline and enable housing where it is most needed are necessary.

“A softening residential sector will have flow-on effects to housing affordability, employment and government revenue.

“The most recent state budget contained little for property, we need to see more of a policy focus to ensure NSW continues to attract investment.”

Ms Fitzgerald’s comments come on the back of the latest ANZ/Property Council Survey, which shows the NSW property industry has tailed in confidence, falling from its position as the state with the strongest sentiment.

The survey found that NSW property industry confidence has dropped seven index points from 141 to 134 over the quarter, and five index points over the 12 months to September 2018.

Capital growth expectations for the residential sector fell, contributing to the lowered overall industry confidence, but state economic growth, forward work schedules and staffing levels all remain positive.