Last month we had a chuckle at a News Limited article encouraging children into the property market. It tried to sell the idea that while minors would have their investment income taxed at 46.5 cents in the dollar it “also means a greater potential benefit from negative gearing.” We can only assume these minors will offset negative gearing losses against their pocket money.
You don’t have to look too far to see the property lobby is extremely desperate. We have been bombarded this year with stories that it is never a better time to buy, especially so for first home buyers.
Statistics from RP data show only 373,000 sales were recorded last year down 25% from the decade average and sitting at a 16 year low. In Brisbane there were 37 percent fewer sales last year.
This year is expected to no better with interest rates scaring off most buyers. A survey by realestateVIEW.com.au of 1475 participants found the number looking to purchase had fallen to 32.7 percent. The same survey last year found 43.5 percent of participants were eager to buy.
Rising interest rates were the primary concern among buyers with 23 percent put off by the banks raising rate out of sync with the RBA. Housing affordability and runaway household expenses were also on the mind of many.
realestateVIEW.com.au General Manager Petra Sprekos said “Consequently, we’re finding most are adopting a wait-and-see approach.”
With price falls around the country entering its second year the wait and see approach is a good one. In some areas property prices are falling faster than what renter’s are paying in annual rents.
» Should your children own property? It’s not always child’s play, but can be done – News Limited, 20th February 2012.
» House sales fall as buyers dry up, according to RP Data – The Courier-Mail, 7th March 2012.
» Uncertainty scaring off home buyers – The Sydney Morning Herald, 7th March 2012.
What about babies. Babies need to encouraged into the property market too.
Seriously, all tax payers need to fund more First Home Buyer schemes so the levered monies turn the market around, again.
Next thing they will be trying to get foetus’s on the property ladder.
In WA, the property council of Australia is promoting a free event – “Confidence Kick Start”
I suspect it will take a lot more than a 2 hour free seminar to kickstart the market again, but at least they are trying.
Must stop rubbing hands together, it is not fair to prey on the indebted and weak. But f**k its fun.
Enjoy your mortgages.
When are the realestate bargain tours going to start in Australia like in the US? When the foreclosed suburbs are on sale, save me a seat on the bus.