The party that is elected to lead Australia on May 18 will inherit a property market with the lowest consumer confidence levels in six years, according to the results of a new survey. 

The ANZ Property Council industry confidence index for the June 2019 quarter recorded its fourth consecutive quarterly decline and now sits at its lowest level since March 2013, falling by eight points to 115 index points.  

Designed to measure sentiment across the property industry, the index survey received responses from 1,184 people between March 11-26.

With a score of 100 index points considered neutral, confidence levels were down in all states, except the ACT.  Over the past 12 months, industry sentiment has dropped by 28 index points, with the biggest falls in Victoria (-33), NSW (-32) and Queensland (-26). The ACT had the smallest decline during the period (-7) followed by SA (-11).

Property Council of Australia Chief Executive Ken Morrison said policy makers should be prepared to step up with a housing contingency plan if required.

“This is a significant further drop in confidence in one of the big engines of the economy, just one week after Treasury flagged the risks of a declining housing sector in the budget papers,” he said.

Related Reading: Ray White and REIA welcome SQM report on Labor's negative gearing policy

“The downturn in residential markets is driving this confidence slump, but we’re also seeing a less positive outlook across a number of important indicators, including expectations around national economic growth, construction and capital growth across some property types.

"It is certainly a bad time to be risking changes to policy settings such as negative gearing and capital gains tax which may lead to a further drop in confidence across the industry."

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PICA Chairman Ben Kingsley. Image: Supplied

Calls for a release of Labor's policy modelling

The Property Investors Council of Australia (PICA) said further evidence proving the use of "dodgy data" shows Labor must urgently authorise the Parliamentary Budget Office to release modelling and assumptions used in their negative gearing and capital gains tax policies. 

PICA Chairman Ben Kingsley said Labor’s keystone policy failed to include off-the-plan and house-and-land packages in its estimation that more than 90 per cent of new investment loans are to people purchasing existing housing stock. 

“Just today Australia biggest aggregator – AFG with over 2900 mortgage brokers – confirmed its mortgage application data for new investment purchases vs. existing property was 43% new and 57% existing,” he said. 

“This seriously puts into question Labor’s logic in crafting the policy and absolutely challenges their revenue assumptions.” 
Mr Kingsley said Labor’s policies are poised to significantly disrupt the property market, and if they won’t deliver on the party’s stated goals because of inaccurate data, action must be taken now. 

“We need to address this immediately, as it very much in the interest of the 10-million-plus property owners that are going to see the values of their property fall to pieces across Australia.” 

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