Peak body says the government must address supply, encourage jobs in property sector
The Real Estate Institute of Australia is calling on the federal government to include a plan for homes and jobs in the 2022 budget.
REIA president Hayden Groves said the organization’s “Pre-Budget Submission 2022” contains three recommendations to grow Australia’s housing and jobs markets: help first-home buyers, unlock supply and create jobs in the property sector.
“We are calling on the government to expand the First Home Loan Deposit Scheme (FHLDS) to allow more first-home buyers to access the deposit guarantee and to expand the First Home Super Saver Scheme (FHSSS),” Groves said. “We have seen a dramatic reduction of loans to first-home buyers, with a staggering fall of 21.5% over 2021, reinforcing the need for governments to address both housing supply and affordability for first-time buyers.”
On a national basis, the average loan size grew by $6,000 to $602,000, Groves said.
“We have also renewed our calls for Budget 2022 to make interest rates tax-deductible for first-home buyers, even for a prescribed period of the loan, as is the case for property investors,” Groves said. “This is all the more important as speculation about interest rates continues in the media. It’s one thing to achieve a deposit, and another to service a loan in an environment as interest rates rise – something we have not seen in Australia for over 10 years – so we need to put in place fair and sensible recommendations to assist Australians coming into the marketplace.”
Groves said a national plan for housing supply and affordability was desperately needed.
“Politicians cannot talk about affordability without talking about supply,” he said. “Affordability in Australia is at its worst point since 2008, where 45.8% of family income was required to meet mortgage repayments. At the same time, stock levels of property available for sale are, in some areas, up to 40% reduced from pre-pandemic levels.”
Groves also pointed out that rental vacancy rates have hit “critically low levels,” driving rents up.
“We need a plan to unlock supply for both buyers and renters that looks at everything [from] land release planning through to incentivising more rental stock coming online and a national plan to phase out stamp duty,” he said. “Stamp duty has made selling and buying a home prohibitive, which has contributed to a long-term downward trend for listings.”
Groves also said the government should help unlock jobs in the property sector. Real estate was heavily impacted by the COVID-19 pandemic in terms of job retention, with about 4,500 vacancies needing to be filled nationwide.
“In Budget 2022, we’d love to see money from reskilling programs dedicated to a property manager mentorship program to help Australians join the real estate sector,” he said. “Real estate is an important part of Australia’s economy, and we want more Aussies in real estate jobs.”
