Property industry confidence rises everywhere except waddling Victoria

Improving macroeconomic conditions are helping to increase property industry confidence nationwide, but Victoria continues to be the ugly duckling with confidence falling, according to the latest Procore/Property Council Survey.

The survey of 508 Property Council members found industry confidence increased, with the Confidence Index rising six points to 120 points. A score of 100 is considered neutral.

Property Council of Australia Group Executive Policy and Advocacy Matthew Kandelaars said expectations around a stable interest rate environment and easier access to debt finance are helping to underscore the industry as it deals with broken state planning systems and government inefficiencies.

“The persistent issue of housing supply and affordability remains a significant concern for industry experts despite confidence rising,” Mr Kandelaars said.

“We see in the survey that high expectations around housing price growth are being driven by a dire undersupply of housing across Australia.

“Participants have said housing supply and affordability is the main concern for the federal and state governments at historically elevated levels since March 2021. This simply cannot continue.

“All levels of government need to back in our national housing target, roll out the welcome mat for investment into the property sector and fix our broken planning systems to deliver the homes we need,” he said.

Victoria was the only state to see a decline in confidence levels and sits well below the national average – falling to 104 points, compared to the national average of 120.

“While other states maintain stable levels of confidence, Victoria is slipping behind the pack. This accords with everything our members are telling us,” Mr Kandelaars said.

“As long predicted, a history of almost-quarterly tax and regulatory changes has dented long-term confidence, which is a story consistent across domestic and international investors.

“The message is simple: the ambitions in the Victorian Government’s Housing Statement rely on stable tax and planning settings, and the confidence of industry to invest,” he said.

Expectations regarding housing price growth have continued to increase reaching 43 index points, the highest level since December 2021 and well above the historical average of 12. A score of 0 is considered neutral.

This comes off the back of an undersupply of housing, with 40 per cent of participants noting housing supply and affordability as the major issue facing the federal government and 41 per cent for state governments.

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