Confidence in the Australian property sector has increased but concerns surrounding housing affordability and supply continued to grow, according to the latest Property Council Survey.
The confidence index, derived from the survey of Property Council members, has increased by one point to 114, reflecting steady industry confidence. A Confidence Index score of 100 is regarded as neutral.
Expectations for housing price growth have surged to 40.4 points, the highest level since Q4 2021, significantly exceeding the historical average of 11.9. A score of 0 is considered neutral in the index.
At the national level, 43% of participants identified housing supply and affordability as the most pressing concern for the Australian government, marking a 2% increase and nearing record levels.
At the state level, 46% of respondents identified housing supply and affordability as the primary critical issue for state governments, an increase of 3%. This was followed by planning and regulation reform, which accounted for 22% of responses.
Mike Zorbas (pictured above), Property Council of Australia CEO, noted the industry’s overall optimism, but said inconsistent planning regimes and frequent tax hikes were challenges clouding the outlook.
“While it is pleasing to see consistency of industry confidence, it is clear that housing supply and affordability continues to be a concern for industry experts just as it will remain a decisive issue, alongside immigration, at the next federal election,” Zorbas said.
“Construction activity for the residential sector is below its historical average, and with the federal government targeting 1.2 million homes by 2029, we simply need to up our game on planning reform and housing delivery.”
Zorbas emphasised the need “to call time on the merry-go-round of rushed taxes” from the Victorian and NSW governments, for planning reform, to increase skilled migration, to boost the run rate of housing choices across the board, and to provide greater government support for specific living choices.
In the December quarter, the survey involving 606 property professionals revealed that companies persist in maintaining confidence in their work schedules and staffing capacities, despite a decline.
Forward work expectations remained optimistic nationwide, at an average index score of 25.4, though slightly below the historical average of 36.4, with Western Australia and the ACT posting robust figures, at 50.9 and 34.2, respectively.
Future staffing expectations, with an index score of 8.5, while positive, are below the historical average of 16.6, signaling a decline in all markets, the Property Council of Australia reported.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
