Thursday 28 September 2023
Property sector confidence remains steady among macro pressures
Despite uncertain macroeconomic conditions, confidence in the Australian property sector has held firm, according to the most recent Property Council Survey.
The survey of Property Council members found industry confidence remained steady, with the Confidence Index decreasing one point to 113 index points. A score of 100 in the Confidence Index is considered neutral.
Property Council of Australia Chief Executive Mike Zorbas said the industry remains broadly optimistic despite pressures from interest rates and inflation.
“Confidence remains positive within the property industry, especially within individual business,” Mr Zorbas said.
“Construction activity expectations are generally positive across all asset classes, with the exception of the retail and office sectors, where they slightly dipped into the negative territory.
“Expectations regarding construction activity in the retirement living sector have hit their highest mark since the December quarter of 2021.
“Likewise, expectations for residential construction are at their peak in over a year, and industrial construction expectations have reached their highest level since the September quarter of 2022,” he said.
During the September quarter the survey involving 696 property professionals indicates that companies continue to have faith in their work schedules and staffing capacities.
Forward work expectations remained positive in every state and territory over the quarter, with an average index score of 31 across the country, just below the historical average of 36.4. The ACT (56) and Western Australia (46.2) returned the strongest figures. A score of 0 is deemed neutral.
Future staffing expectations remained positive across the country at 12 index points, just below the historical average of 16.6, but fell in all markets except in Western Australia and the ACT.
As survey participants have moderated their anticipations regarding future interest rate increases, expectations regarding housing price growth have continued to increase, reaching 36.8 points on the index, the highest level since the December quarter of 2021.
Nationally, 41 per cent of respondents pinpointed housing supply and affordability as a top concern for the Australian Government. At the state level, 43 per cent of respondents identified it as the most crucial issue for state governments.
Mr Zorbas said deficiencies in government policies and structures have led us to this juncture.
“Addressing the lack of investment in planning systems that fail to adequately address the essential needs of all Australians is a must,” Mr Zorbas said.
“While governments have tinkered around the edges to provide housing supply in recent months, this survey shows that the property industry is still concerned about the lack of housing supply,” he said.
Media contact: Rhys Prka | 0425 113 273 | [email protected]
Ellie Laing-Southwood | 0416 007 830 | [email protected]