Real Estate Institute of Australia (REIA) is calling on the Federal Government in election year to tackle key issues on our minds: homes and jobs in Budget 2022.
REIA President, Hayden Groves said the REIA Pre-Budget Submission 2022 contains three simple recommendations to grow Australia’s homes and jobs markets: help first home buyers, unlock supply and create jobs in property.
“We are calling on the government to expand the First Home Loan Deposit Scheme (FHLDS) to allow more first home buyers to access the deposit guarantee and to expand the First Home Super Save Scheme (FHSSS).
“We have seen a dramatic reduction of loans to first home buyers with a staggering fall of 21.5% over 2021, reinforcing the need for governments to address both housing supply and affordability for first-time buyers.
“On a national basis, the average loan size grew by $6,000 to $602,000.
“Lending commitments for housing rose to $32.8 billion with Victoria the strongest growing state increasing by 5.2%.
“We have also renewed our calls for Budget 2022 to make interest rates tax deductible for first home buyers, even for a prescribed period of the loan, as is the case for property investors.
This is all the more important as speculation about interest rates continues in the media.
“It’s one thing to achieve a deposit, and another to service a loan in an environment as interest rates rise – something we have not seen in Australia for over ten years – so we need to put in place fair and sensible recommendations to assist Australians coming into the marketplace.”
Mr Groves said that current market conditions mean that a national plan for housing supply and affordability is badly needed.
“Politicians cannot talk about affordability without talking about supply.
“Affordability in Australia is at its worst point since 2008 where 45.8% of family income was required to meet mortgage repayments.
“At the same time, stock levels or property available for sale are in some areas up to 40% reduced from pre-pandemic levels.
“The weighted average median house price for the eight capital cities increased to $961,059 over the year to September, 2021 while the proportion of income required to meet loan repayments increased to 36.2% nationally.
“Coinciding with this is a lack of rental supply which has seen vacancy rates hit critically low levels of under 1.0%. Rents are increasing and those needing to rent properties are struggling to secure a lease.
“We need a plan to unlock supply for both buyers and renters that looks at everything to land release planning through to incentivising more rental stock coming online and a national plan to phase out stamp duty.
“Stamp duty has made selling and buying a home prohibitive which has contributed to a long-term downward trend for listings.”
Mr Groves said that the real estate industry is hiring and that Government could help unlock jobs in one of Australia’s most talked about industries.
“Real estate has been one hugely impacted in terms workforce retention from the COVID-19 pandemic with around 4,500 vacancies needing to be filled Australia wide.
“40% of our property management businesses are now facing staff shortages due to lack of skilled candidates.
“We are seeing agencies have great success recruiting candidates from sectors like tourism, aviation and retail and want to give Australian workers support and confidence to successful transition to a career in real estate from other roles.
“In Budget 2022, we’d love to see money from reskilling programs dedicated to a Property Manager Mentorship program to help Australians join the real estate sector.
“Real estate is an important part of Australia’s economy, and we want more Aussies in real estate jobs.”
The REIA Pre-Budget Submission 2022 can be viewed here.
