According to The Australian Financial Review, the federal budget did little to ensure Australia could reach its target of building 1.2 million new homes over the next five years because it failed to meaningfully boost the number of workers available to build them, the property industry and community groups say.
While budget included $89 million to boost the number of training positions, it only included $1.8 million to fast-track the assessment of 1900 migrants with necessary construction skills, when the industry needed an estimated 486,000 new people by 2026. https://www.afr.com/property/residential/imported-tradies-need-to-live-somewhere-too-20240513-p5jd80
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According to The Australian Financial Review, Labor’s revamp of foreign investment rules designed to boost support for much-needed rental housing has been welcomed by the property industry, as it also warns that current tax settings remain a barrier to offshore capital.
Under the new rules announced by Treasurer Jim Chalmers, a long-standing prohibition on foreign ownership of established housing would no longer apply to foreign investors wishing to acquire existing build-to-rent housing. The largest hurdle remains the imposition of a 30 per cent withholding tax on the managed investment trusts through which offshore players typically hold BTR assets they have developed in Australia. The government has promised to halve that tax, bringing it in line with the tax rate applied to other forms of foreign-owned commercial property. However, draft legislation released last month setting out the eligibility for the tax reduction includes a requirement that 10 per cent of the dwellings in a build-to-rent project be offered as affordable tenancies. Cedar Pacific chief executive Bernie Armstrong said lengthy FIRB approval processing times was just one of the challenges in bringing in foreign capital. The others were the very high taxes and surcharges imposed on foreign investors and uncertainty around taxation investment rules. https://www.afr.com/property/residential/firb-changes-are-fine-but-please-fix-tax-investors-20240501-p5fo33
According to The Australian Financial Review, median house prices in Brisbane and Adelaide are on track to hit $1 million by the end of the year, fuelled by a persistent supply shortage and strong demand, despite a sharp slowdown in the quarterly pace of growth, Domain says.
Brisbane’s median house value has risen to a record $924,498 over the past three months to March, and Adelaide surpassed the $900,000 mark for the first time during the same period. But their quarterly growth momentum slowed substantially as stretched affordability weighed on sentiment, said Nicola Powell, Domain’s chief of research and economics. https://www.afr.com/property/residential/median-house-prices-in-brisbane-and-adelaide-to-hit-1m-by-december-20240423-p5flwa
According to The Australian Financial Review, Japanese investment in Australian real estate surged last year to a record $2 billion as this country’s housing crisis draws a new wave of investors wanting to put their capital and skills to work.
Of the 53 deals in various sectors involving Japanese investors last year, 13 were property transactions – up from six a year earlier – Herbert Smith Freehills’ (HSF’s) Japan-Australia Investment Report 2023 shows. Decisions such as the NSW Minns government’s plan to boost housing density around 39 transport hubs in Sydney – expanded to 45 on Friday – and build 185,800 homes over 15 years are creating new opportunities. https://www.afr.com/property/commercial/japan-investment-in-australian-real-estate-hits-2b-record-20240407-p5fi0m
According to The Australian Financial Review, housing affordability is at its worst in more than two decades, with both aspiring homeowners and low-income tenants slammed by surging prices, rents and interest rates, the latest ANZ Housing Affordability report shows.
The average portion of income needed to service a new mortgage blew out to 48.9 per cent nationwide during the March quarter, up from 43.1 per cent a year ago and a sharp jump from the 34.8 per cent decade average. https://www.afr.com/property/residential/housing-affordability-the-worst-in-20-years-anz-20240415-p5fjxs
According to The Australian Financial Review, Australia will fall 90,000 homes short of this year’s national target of 240,000 new dwellings, affordable housing industry figures have said after new housing starts for 2023 came in at the lowest level in 11 years.
Dwelling commencements over the last calendar year undershot the national cabinet total by almost one-third, falling to 163,836, Australian Bureau of Statistics figures showed. This was the weakest since the 2012 total of 153,580. “Dwelling completions for 2024 are currently projected at approximately 150,000, which is approximately 90,000 dwellings short of the government’s target of 240,000 per year,” said Matt King, the director of economics and research at PowerHousing Australia, an industry grouping for affordable housing providers. https://www.afr.com/property/residential/new-housing-starts-sink-to-11-year-low-target-more-than-a-third-down-20240410-p5firq
According to The Australian Financial Review, investment manager Cedar Pacific has joined forces with Japanese timber, housing and building materials giant Sumitomo Forestry on plans to develop a $1.2 billion portfolio of build-to-rent apartments, where much of the focus will be on sustainability.
Under the deal, Japan’s Sumitomo will acquire just short of 50 per cent equity stakes in build-to-rent projects undertaken in the JV partnership, starting with a $375 million development already under construction in Brisbane. Cedar Pacific – best known as a developer of student accommodation towers, but which flagged a move into BTR in 2020. https://www.afr.com/property/residential/japanese-forestry-giant-to-partner-on-1-2b-build-to-rent-portfolio-20240402-p5fgr6
According to The Australian Financial Review, more than 14,000 homes bought about three years ago were sold in the December quarter, an increase of 800 homes compared with the previous three months, in what could be a sign that some property owners have struggled to cope with higher interest rates, data from CoreLogic shows.
That represents 15.9 per cent of all the 90,000 properties sold in the period, up from 15.7 per cent in the September quarter and a jump from 13.4 per cent in the December quarter of 2022. About 1000, or 6.5 per cent, of the properties resold within three years made a loss of $30,000 on average. Eliza Owen, CoreLogic head of research, said an increase in short-term resales was occurring amid higher interest costs and could be a reflection of rising mortgage stress. https://www.afr.com/property/residential/more-homeowners-cash-out-within-3-years-as-rates-prices-rise-20240328-p5ffvx
According to The Australian Financial Review, the supply of new homes will crash to the lowest level in over a decade by 2026, worsening housing and rental affordability, and leaving the federal government far short of its goal to build 1.2 million homes by mid-2029.
Across capital cities, 79,000 new homes will be finished in 2026, a drop of 26 per cent compared with last year due to planning bottlenecks, labour shortages and soaring material costs. https://www.afr.com/property/residential/new-housing-supply-to-hit-decade-low-20240318-p5fd6t
According to The Australian Financial Review, Melbourne’s apartment market could be starting to emerge from years of sluggish capital growth after values rebounded sharply in a number of inner suburbs over the past three months, data from CoreLogic shows.
Apartment prices in Parkville, Carlton, North Melbourne, Southbank, Docklands, East Melbourne and central Melbourne all accelerated and have reversed their declines. https://www.afr.com/property/residential/suburbs-where-apartment-values-are-gaining-the-most-momentum-20240313-p5fc0k |
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