Industry body says regulatory barriers are likely to curb the rate of housing supply… RBA warns of wealth shift from young to old… Rents fall in capitals in July…
Home building set to stall says industry body
The level of new home starts across Australia for the 2014/15 period is estimated to have hit a record high of 214,450. The Housing Industry Association’s chief economist Shane Garrett says that the figures highlight “the role of the low interest rate environment in supporting higher levels of new home building, as well as strong, migration-driven population growth over the past decade.”
However he warns that the outlook is less favourable as regulatory barriers are likely to curb the rate of supply: We are faced with an excessive taxation burden on new housing, land release which is simply too slow and a raft of planning restrictions. All of these make it difficult for our industry to meet the housing needs of Australians.”
Garrett says that the effects of these conditions will begin to be felt in the next 12 months with a 7 per cent drop in new starts during 2015/16. He says that there will be just 175,000 new homes each year for the rest of the decade which falls short of demand.
RBA warns of wealth shift from young to old
Property prices are making Australia’s older citizens wealthier while younger Aussies are less well off. The Reserve Bank of Australia warns that it’s not a good situation for the country. Philip Lowe, the deputy governor, said in Perth that the wealth shift means that parents are using their property windfalls to help their children become first-home buyers instead of spending more which would benefit the wider economy. He also said that interest rates are low but that household balance sheets are “riskier” than before.
Rents fall in capitals in July
The rent paid by tenants in every capital city fell in July according to CoreLogic RP Data. The combined decline was 0.3 per cent and the rate of annual growth fell to a record low of 0.9 per cent.
The lower rents are attributed to the high level of building across the country. Darwin saw the largest decline in rents, down 0.9 per cent in the month and 9.3 per cent in the year. Perth (0.8 per cent), Hobart (0.6 per cent) and Canberra (0.4 per cent) also saw above average declines from month-to-month. On a yearly basis Sydney (2.5 per cent) and Hobart (2.3 per cent) saw the largest increases in rents.
The level of new home starts across Australia for the 2014/15 period is estimated to have hit a record high of 214,450. The Housing Industry Association’s chief economist Shane Garrett says that the figures highlight “the role of the low interest rate environment in supporting higher levels of new home building, as well as strong, migration-driven population growth over the past decade.”
However he warns that the outlook is less favourable as regulatory barriers are likely to curb the rate of supply: We are faced with an excessive taxation burden on new housing, land release which is simply too slow and a raft of planning restrictions. All of these make it difficult for our industry to meet the housing needs of Australians.”
Garrett says that the effects of these conditions will begin to be felt in the next 12 months with a 7 per cent drop in new starts during 2015/16. He says that there will be just 175,000 new homes each year for the rest of the decade which falls short of demand.
RBA warns of wealth shift from young to old
Property prices are making Australia’s older citizens wealthier while younger Aussies are less well off. The Reserve Bank of Australia warns that it’s not a good situation for the country. Philip Lowe, the deputy governor, said in Perth that the wealth shift means that parents are using their property windfalls to help their children become first-home buyers instead of spending more which would benefit the wider economy. He also said that interest rates are low but that household balance sheets are “riskier” than before.
Rents fall in capitals in July
The rent paid by tenants in every capital city fell in July according to CoreLogic RP Data. The combined decline was 0.3 per cent and the rate of annual growth fell to a record low of 0.9 per cent.
The lower rents are attributed to the high level of building across the country. Darwin saw the largest decline in rents, down 0.9 per cent in the month and 9.3 per cent in the year. Perth (0.8 per cent), Hobart (0.6 per cent) and Canberra (0.4 per cent) also saw above average declines from month-to-month. On a yearly basis Sydney (2.5 per cent) and Hobart (2.3 per cent) saw the largest increases in rents.
