Property owners and agents in Queensland should watch the state election in November with great interest as key infrastructure projects could decide property values, according to an industry expert.
According to The Property Club’s CEO, Kevin Young, the Queensland economy has been holding back strong growth in property values, despite the fundamentals suggesting a growing market.
The latest ABS figures for dwelling approvals growth show that during March and April 2020, residential building approvals have dropped by nearly half since December 2015.
While dwelling approvals have been on the decline over the past five years, in contrast, the population of Queensland since 2015 has surged by over 300,000 persons to 5.11 million people.
Normally, when population growth outperforms new dwelling growth over a long period of time, property values start to rise.
“While this has occurred in some parts of Queensland, the overall property market has been held back due to an underperforming state economy, which has seen the unemployment rate rise to 7.9 per cent,” Mr Young said.
He explained that getting the economy back on track will be the catalyst to improving the property market in the country’s north.
“The forthcoming Queensland state election will be focused on the economy and will force the major political parties to put forward job-creating policies and investment in new infrastructure,” he said.
“This will result in a major change in government focus on achieving, rather than just talking about, creating jobs.”
The Queensland Labor Party is promising a three-stage plan to fire up the sector, with stage one — building vital infrastructure — being headlined by a $51.8 billion budget over the next four years boost to the construction sector, a $400 million boost to roads and services, and $100 million to support small businesses.
Stage two is designed to strengthen Queensland’s industries through taking advantage of new opportunities out of COVID-19.
Stage three involves enabling future growth through skills training, innovation research, creating a competitive regulatory environment and trade and investment.
The Liberal Party, on the other hand, will try to get the economy moving through its five main priority areas.
The Liberal Party said it will run on infrastructure projects to bust congestion, for better health and education results, lower taxes, cheaper electricity and fuel, and delivering water security.
Mr Young believes that if a party can turn around the economy, it will support the property market.
“The outcome of the election should see a major turnaround in the state economy that will result in renewed confidence in the property market,” he said.
“In particular, South East Queensland should benefit from the state election as it attracts the vast majority of interstate migration to Queensland.
“This strong interstate migration is now resulting in new investment in the Gold Coast, with the recent announcement that the first stage of the $2.3 billion Gold Coast precinct development by Azzura will start later this year.”