The ACT’s booming property industry may be coming off the boil with new ANZ/Property Council Survey results revealing a dip in confidence for the September 2018 quarter, after a strong performance by the nation’s capital for the preceding 12 months.
ACT Executive Director of the Property Council, Adina Cirson said the survey cast a cautionary shadow over the present quarter.
“This survey shows an amber light after a sustained period of green lights. Canberra is one of the worst performing markets, second only to NSW. The latest survey is sending some mixed signals and they should be watched carefully,” Ms Cirson said.
According to survey – the leading business sentiment index – the ACT recorded a negative shift in sentiment – down 3 index points in the 12 months to September 2018 – but remains in a solid position overall at 136 – well up from just 94 points measured in 2012.
The most dramatic change is the dive in confidence in the availability of debt finance, which hit -32.8 points. The Property Council said this, coupled with speculation around an interest rate rise, was causing significant concerns for the industry.
ANZ/Property Council Survey – September quarterly results – Australian Capital Territory
“Indicators such as forward work schedule expectations have dampened this quarter, dropping well below the June quarter high which had us leading the nation,” Mr Cirson said.
“We are now seeing a levelling of these labour expectations, but there is still a decent confidence in hiring more staff, and that their financial outlook continues to hold.”
The survey also revealed a levelling but mostly positive outlook for housing, retirement living and industrial, while retail (now negative), office and hotel/tourism capital values have dropped.
The Council said retirement living growth expectations were now leading the nation at a record 70.2 points, reflecting rising demand for retirement living product to match the increased growth of the ACT’s population – and an urgent need to start delivering more housing choice for older Australians.
“This quarter we see rising expectations in the retirement living sector coupled with a further confidence drop in the ACT Government’s performance and ability to plan and manage for growth,” Ms Cirson said.
“We remain concerned that demand is outstripping supply in the retirement living sector, with the latest ACT population projections estimating the number of seniors aged 65 and over will increase from 53,000 in 2018 to 95,000 by 2041.”
If this trend continued, the number of ACT seniors will double within the next three decades, reaching 120,000 by 2050.
“The ACT is one of the fastest growing regions in Australia, so we continue to push the Government on streamlined planning approvals, ensuring we have the right tax framework and incentives in place to encourage development where and when it is needed to meet the needs of our current and future residents,” Ms Cirson said.
“Our housing mix needs to cater for the future needs of our city, including a better approach to managing density which will be critical to long-term planning for our future residents.”