As we inch ever closer to the Federal election, are there any lasting effects on how we view the real estate market and its growth?
There have been some stark reminders of how elections can affect confidence in the property market lately. For example, the Real Estate Institute of Victoria recently reported that in Melbourne over the last two weeks of June, record numbers of auctions were anticipated – people clearly want to sell their property as their economic future grows less certain.
But what about the Canberra property market ? Have we seen any changes as we edge closer to the polls?
Is the election impacting Canberra property?
Looking at CoreLogic RP Data's monthly indices for May, you can see a real growth spurt in Canberra property values over recent times. Over the course of May, property values here grew by 2.49 per cent – the second best performance in the country.
This has been largely driven by houses, where values went up 3.11 per cent – units saw a slight drop across May.
We can't say for sure if the election is pushing this activity, but when you compare it to the long term, it certainly is excellent growth.
The bigger picture
CoreLogic RP Data has also put together property values now and compared them to the last time we went to the polls as a nation. In the grand scheme of things, value growth in property for the Canberra electorate has not been stellar over the past three years, sitting only at 9.3 per cent.
For comparison, the best-performing electorate in the country (Bennelong, NSW) saw values go up by 73.5 per cent in this time. While it has been slow going for our corner of the country, it seems that we are picking up a head of steam as we get closer to the election.
Will the market keep going?
Will we end up with restrictions on negative gearing and capital gains tax?
The question of whether the local market can maintain this growth past the election is one that can, unfortunately, only be properly answered in hindsight. Without clear knowledge of what the next government will look like and what property legislation will come about, it is too difficult to say. For example, will we end up with restrictions on negative gearing and capital gains tax?
One thing is for certain, however, and this is that in the long term, real estate always tends to be a good investment . It grows in fits and starts, but it almost always grows. If you want to find out more about the current market, make sure to get in touch.