Scott Morrison winning the election and returning the Coalition government to power is a “really good” outcome for the South Australian housing market, according to Ouwens Casserly Real Estate managing director Alex Ouwens.
Mr Ouwens said there are four reasons for this.
“Firstly, it is positive for renters as there will be no impact to negative gearing,” he said.
“If the opposition had been successful with their policy to remove it, then it would increase rental prices, as there would be less investors and therefore less investment properties. Property prices were also widely predicted to fall due to less buyer demand for real estate investment in general.”
He also said capital gains tax not being affected will have positive knock-on effects.
“The removal would have meant more tax and less profit for people that own investment properties,” he said.
“The consistency of having a known government in place will bring a positive effect to the marketplace. Two interest rate cuts are predicted over the course of the remainder of 2019, so the combination of stability along with interest rates being reduced will be beneficial for the property market.”
Thirdly, Mr Ouwens said the Coalition was a reluctant participant in the banking royal commission.
“It is widely speculated that the banks will become more liquid in their lending practices,” he said.
And, he added, the Coalition has promised tax cuts instead of tax increases.
“This will lead to more money in the pockets of Australians. We spend around 35 per cent of our income on our homes. More money in our pockets means greater affordability to borrow more for our residences and investments.”
Mr Ouwens also said it is worth noting that any potential pause that can happen in an election campaign for some months afterwards is unlikely to happen.
“We’ve seen this already in the first one or two days after the election already. The number of clients who have confidently made the decision to go to market has increased, which means positive signs for the Adelaide market in particular.”