P: +61 7 3823 4988
F: +61 7 3823 1588
70 Old Cleveland Rd Capalaba 4157
Joe Hockey delivered his second budget as Federal Treasurer last week. For the many investors who were worried about the changes to negative gearing, capital gains tax and superannuation changes, there was a sigh of relief as no changes were announced. With the federal election likely to fall after the budget next year, I would suspect that again no changes will be announced within these areas. This goes well for the confidence of all investors including specifically those who invest in the property market. Figures from Corelogic during March indicated that 41% of the entire property loan market was made up from investment loans which are up over 6% from the same period last year. The graph below is a good indication of the confidence that investors are showing in property.
Whilst the Budget delivered nothing in particular for property owners, it does create the climate for our economy to move forward and grow. With the stimulus provided to small business, one hopes that consumer confidence will improve which in turn will benefit all sectors of our economy. Looking forward then, interest rates will remain low with a possibility of another rate drop, whilst the likelihood of rate rises seems a far way off.
The only mention in the Budget of any connection to the property market was that the National Rental Affordability scheme will be suspended pending a review. For most investors this will have no effect as the scheme only benefited some property developers and marketers.