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Staff Reporter
Confidence levels are low in the South Australian property industry, on the back of an unstable international economy and high state taxes, a survey has revealed.
The inaugural Property Council/ANZ Property Industry Confidence Survey, undertaken in September this year, has revealed that on a national scale, South Australian property industry confidence ranked among the lowest of all states.
Property Council of Australia (SA Division) executive director Nathan Paine said the survey highlighted several issues for the property sector.
"When asked about their views on the state and national economies, respondents were clear in their view that both would weaken," Mr Paine said.
"Most respondents thought the construction cycle for residential, commercial office, industrial and shopping centres had stalled, and in comparing the performance of various property asset classes, most respondents expected residential capital values would decline in the next quarter."
Moreover, almost 70 per cent of the 460 South Australian respondents believe the current rate of business tax in South Australia is either high or too high, Mr Paine said.
The survey canvassed the views of 4,123 respondents natinally – including owners, developers, agents, managers, consultants and government - across all major industry sectors and regions.
ANZ's chief economist Warren Hogan said although tough global headwinds had sapped local confidence - channelling into falling house prices - South Australians did have cause for optimism.
"Since peaking in late 2010, Adelaide house prices have declined by 5.4 per cent reflecting heightened economic uncertainty and weakened sentiment," Mr Hogan said.
"Nonetheless, fundamentals are supportive with the residential vacancy rate remaining near record lows.
"And despite a relatively subdued outlook for state economic activity, strong fundamentals should limit further downside to house prices. Office markets also remain tight, especially for premium space."
Results from the survey were used to compile the Property Industry Confidence Index, which revealed confidence in South Australia was among the lowest in the nation. South Australia recorded an index reading of 99.6 in the September quarter, significantly lower than the national average of 104.1, and the lowest rating but for Tasmania.
In contrast, Western Australia and Northern Territory rated at 122.3 and 119.8 respectively. 'Neutral' sentiment sits at 100.
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