From the Missive Archive for your perusal and information only:-
Several readers made contact with us yesterday, asking if we knew about the actual distribution of the Building Boost applications across the state.
We have had a hell of a time getting such information out of the Government, with more than the usual amount of storm walling. Queensland Labor are next releasing information about the Building Boost in late November.
Me-thinks – and assuming a successful 2018 Gold Coast Commonwealth Games bid (which, by the way, will be announced at 8am this Saturday) – that we might be going to the state polls much sooner than we think. Several glossy new documents – well, revamped ones really – have been released in recent weeks, including Queensland Government’s 20-year Infrastructure Plan (again!). But more on this later.
My money is on Anna Bligh calling an election this weekend. If so, we will be voting this side of Christmas.
The table below outlines the distribution of the Queensland Building Boost applications as at the 7th October – the latest figures available. Remember, as at 26th October (again, the latest total stats available) 1,113 state-wide applications had been made, of which 379 have been approved. Now, again, maybe buyers are waiting in the wings and we will see an enormous rush towards January. I do hope so. But the stats to date don’t hold that much promise.
Now, let’s draw some attention to the latest version of the state’s 20-year Infrastructure Plan. It would really help matters (or at least humour us) if the Queensland State Government would at least acknowledge the property industry’s existence. According to the 20-year Infrastructure Plan, the four key industries behind Queensland’s economic growth are:
No mention of the property or construction industries. None at all. How ironic that this ignorance is highlighted in a document that largely requires the construction industry to implement it. So, in the lead up to a state election – whenever it is – here are some pertinent facts.
- The property industry is the largest private sector contributor to the Queensland economy
- It generates $31 billion of Queensland’s GSP – 13% or one and half times mining’s 8.4%
- Employs directly 280,000 – the state’s largest direct employer
- With indirect jobs – 585,000 or 30% total employment in Queensland
- Single largest contributor to State taxes – $3.8 billion or one-third total state tax revenue
- In addition, local governments across Queensland collect over $4 billion in rates and charges each year
Sorry if I sound short-changed right now and, frankly, more than a little pissed off!
Oh, and talking about being peeved, don’t get me started on the carbon tax debacle. I have said enough on this topic. I will let others do some talking on this for a change.
9th November 2011
Several subscribers made contact with us a few weeks back in response to ourHogtied missive. Most who replied were of the impression that the Queensland building boost would lift demand and help get more new development underway.
Well, for those who think that building grants or first home buyer boosts for that matter are the answer, you had best think again. We are already half way through the six month Queensland “building blitz”, in which Queensland Labor was going to help facilitate up to 14,000 new housing starts across the state with its $10,000 Building Boost.
As at the 26 October, only 1,113 building boost applications have been received by the Queensland government and just 379 (yes 379) boosts have been approved – $3.8 million worth of support, costing an estimated $660,000 to advertise and promote the campaign.
Now, to be fair, the take-up is on the rise, but whether or not it is a hockey-stick style graph is debatable. To quote Queensland Treasurer Andrew Fraser from Hansard on the 27th of last month – “I can advise the House that as of yesterday the number of applications is now 1,113. In fact, the number approved is 379, but I want to make this point: as at 30 September, just a few weeks ago, it was 569. In the week after that it jumped to 698. In the week after that it jumped to 843 and in the week after that it jumped to 992. So we do see the hockey stick approach to the graph at the moment.”
Yet, despite such reassurances, the 1,000-odd boost applications represent just a 4% increase on last year’s building approval across the state – which was just 27,500 starts – a ten-year low. The real result – being 379 approvals – is a measly 1.3% lift in new dwelling activity.
Now maybe there are many more buyers waiting in the wings. I hope so, but maybe, as we suggested, a 2% reduction in the asking price of a new property just doesn’t cut it.
The increase – as outlined by Fraser above – appears to be steady at around 150 new applications by per week. So by the end of January – and assuming interest doesn’t sag during the Christmas holidays (a big ask!) – a total 3,000 applications would have been received. Not a great result, given the 14,000 target, if you ask me.
Now we have some in the development industry calling for the boost to be extended. Well I will let Albert Einstein reply on my behalf. “The definition of stupidity is doing the same thing over and over again and expecting different results.”
Assuming that the $140 million set aside by the Queensland government for this six month blitz isn’t used up (which is extremely unlikely), and also assuming that Queensland Labor really want to help the new housing industry, how best should they spend this “windfall”?
The answer is simple – remove stamp duty from off-the-plan transactions. The impact – as shown in both Victoria and more recently New South Wales – should be immediate and very positive.
We have just completed work on this for the Property Council of Australia; and whilst we are embargoed from releasing the key findings for the time being; we can say that removing stamp-duty from off-the-plan sales is likely to increase new housing starts across the state by between 10% and 15% per annum. Yes, every year!
There is also local evidence that paying a buyer’s stamp duty works much better than the boost. Some of the larger developers – who are supportive of the $10,000 handout – have been making sales because they have used this government largesse as cover as they offer – often quietly – to pay a buyer’s stamp duty.
Queensland needs a competitive advantage. Our main competition is New South Wales and Victoria. Dropping stamp duty for off-the-plan purchasers gets us back to a more level playing field.
It is a step in the right direction. (Source) MATUSIK MISSIVE
Linda Jane Debello LREA
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