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ACT asbestos buy-back could cause price boom

ACT asbestos buy-back could cause price boom

by Staff Reporter 0 comments

The Real Estate Institute of the ACT has warned of an "artificial price boom", with hundreds of families affected by asbestos looking for new homes following confirmation of a $1 billion buy-back scheme.

The Commonwealth will provide a $1 billion concessional loan to the ACT to enable the government to buy back and demolish all 1,021 Mr Fluffy homes within the next five years.

The homes will be purchased at full market value, as though they were not affected by the remnant loose-fill asbestos.

Affected homeowners will be able to sell their homes back to the government as soon as January.

Real Estate Institute of the ACT chief executive officer Ron Bell said the decision would have an impact on the housing market, with potentially hundreds of families looking for new homes.

He said it was unlikely to represent the boom that the territory experienced following the bushfires because of the lengthy time period, but a lack of stock could push up prices.

"If we didn't have a good stockpile of properties to purchase, and we don't, and all of a sudden you had 200 families looking for a property … you could have an artificial boom," Mr Bell told Fairfax Media.

He said unless the ACT government's Land Development Agency made more land available there would not be appropriate diversity of stock on the market.

The institute generally welcomed the decision on the buy-back scheme but was disappointed the federal government would not share the cost of the program.

Also speaking to Fairfax Media, LJ Hooker Manuka principal Stephen Thompson said the decision would have a major effect on the market, with prices expected to rise from the time the scheme began.

He said there were already approximately 500-1,000 fewer properties on the market than usual at this time of year.

"We're going to see a major increase in prices.

"Stock levels are going to be drying up because we're going to have a strong spring,” he added. 

ACT asbestos buy-back could cause price boom
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