The state government’s planned property tax increases risk wiping the state off the global investment map, warns Chris Mountford,
executive director of Property Council Queensland.Kevin Farmer
THE state government’s planned property tax increases, due to come into effect on July 1, risk wiping the state off the global investment map.
As the government begins work on the State Budget, the Property Council is ramping up efforts to highlight the hidden effects of the tax hikes.
These tax hikes will increase the cost of doing business, damage Queensland’s economic competitiveness and impact on every Queenslander.
With Queensland preparing to leverage the Commonwealth Games to attract new investment opportunities, these tax increases couldn’t come at a worse time.
Election campaign costings, released in the days prior to the November 2017 state election, revealed the government’s intention to introduce new land tax thresholds for aggregated land holdings with an unimproved value above $10 million.
Individuals, companies and trusts who are within this new threshold will be subjected to a 25% increase in the rate of land tax from July 1.
The government has also committed to increasing the stamp duty surcharge on foreign buyers of residential property from 3% to 7%.
The end result of this decision will be higher business rents, higher costs for new homes and damage to Queensland’s reputation as an investment destination.
Businesses who lease premises from larger landlords can expect additional rental and occupancy costs.
New homebuyers can expect an additional $800-$1000 added to the cost of purchasing a new home.
We once were able to lure investment from interstate and overseas with attractive tax rates, but we now find ourselves uncompetitive with our southern neighbours.
The Property Council is calling for the government to abandon the tax increases and commit to review and modernise Queensland’s property tax framework.
Our current land tax thresholds haven’t been changed in a decade, leading to significant bracket creep as property values have increased dramatically.
We need a simpler, fairer and more attractive property tax system to unlock investment and create jobs.
An all-encompassing review of Queensland’s outdated thresholds and property tax rates needs to be undertaken to put Queensland back on the investment map.
Chris Mountford is executive director of Property Council Queensland.
Why Brisbane property is set for great capital growth
Over the last 10 years, Brisbane has suffered the GFC and floods. As a result, prices are now extremely affordable for a capital city. The Brisbane market has some of the best growth prospects nationwide, so let’s explore why this market is set to take the gold medal for capital growth.
Since the GFC, net migration levels have been very poor for Queensland. However, net interstate migration to Queensland has tripled over the last three years. Interstate migration to Queensland fell to a low of 5,753 in 2014, increasing to 11,581 in 2016 and 15,716 in 2017.
The majority of these people are moving from Brisbane, theCoast and the Gold Coast. This increase in migration levels is due to housing affordability compared to other states, improving employment markets and the lifestyle factors that come with those two factors.
There is a surge of major development and infrastructure projects currently underway in Brisbane, to the sum of $12 billion.
Examples of these major projects are:
- Queens Wharf ($3 billion) – Comprising of 1,000 hotel rooms across five hotels, a residential precinct of 2,000 units, a 100-metre sky deck, 50 bars and restaurants and a pedestrian bridge connection to Southbank. This will completely reshape the Brisbane’s river CBD precinct.
- Cross River Rail ($5.4 billion) – The project will deliver a 10.2-kilometre rail link from Dutton Park to Bowen Hills, with 5.9 kilometres of tunnel under the Brisbane River and CBD, connecting to both northern and southern rail networks in and out of the CBD.
- Brisbane Quarter ($1 billion) – This project is a mixed-use precinct incorporating office, retail, hotel and residential uses.
- Brisbane Live ($2 billion) – A new entertainment precinct located on top of the Roma Street rail interchange hub. Facilities include a $450 million, 17,000-seat arena along with multiplex cinemas, an amphitheatre and proposed commercial, residential and hotel towers.
Last year was one of the strongest years for job growth in Brisbane’s history. In the last 12 months, Brisbane’s jobs growth has increased by 7.6 per cent. As a result, unemployment has fallen across the board to 5.5 per cent.
Recent jobs growth has been driven by Queensland’s service industries. While the resources sector has cut 22,000 jobs over the past two years, four other industries each created more jobs than were lost in the resource sector over that period: health, education, professional services and accommodation and food services (which is closely related to tourism).
The median dwelling across Brisbane cost 6.3 times higher than the median household income. As a comparison, Sydneywas ranked the second worst most unaffordable market in the world. House prices are a whopping 13 times higher than the median household income.
These factors are significant for Brisbane’s capital growth prospects over the coming years. Well-located houses (not units) are expected to be some of the best preforming sub-markets in Australian real estate.
Where else but Queensland!
Gold Coast real estate market set to pick up after Comm Games
The Gold Coast real estate market is set to pick up after the Commonwealth Games.Source:Getty Images
The Gold Coast real estate market may have gone quiet throughout the Commonwealth Games but it won’t stay that way for long.
IT WAS a quiet auction weekend on the Gold Coast but the market is expected to pick up now the Commonwealth Games are over.
CoreLogic auction market commentator Geoff White said the property market had gone quiet throughout the Games.
He said business was affected across the board, with many retailers including cafe and restaurant owners reporting a downturn over the past two weeks.
However, he was confident the market would return to “business as usual” now the event had wrapped up.
“(The market) has been affected by the Commonwealth Games, there’s not doubt about that,” Mr White said.
“But that’s not a sign of things to come, I wouldn’t have thought.”
According to CoreLogic, there were 19 auctions over the weekend with seven recorded results, whether they be sold of passed-in.
This coming weekend, there are 37 properties set to go under the hammer on Saturday and another 54 on Sunday.
Most of the properties scheduled to go to auction on Sunday are part of Ray White Queensland’s Gold Coast Auction Spectacular at Main Beach’s Sheraton Grand Mirage.
Coast property market to flourish for years to come
THE Coast’s popularity as a lifestyle destination is strengthening its housing market, according to real estate executive Rem Rafter.
The CBRE Sunshine Coast managing director said the housing market was in “good shape”, driven by increasing population including interstate migration.
“The traditional unit market is very good with strong demand,” Mr Rafter said.
“New developments have had good pre-sales, including Stockland’s Oceanside Kawana and several apartment projects by the Walter Iezzi Property Group.
“Brisbane-based Mosaic Property Group has also been active on the Coast, with off-the-plan apartment projects under way at Coolum and Kings Beach, Caloundra.
“We have seen from recent site sales that developers are concentrating their efforts in these areas and investment yields have become quite tight as a result.”
He said the Coast’s apartment and housing market could flourish for another two to three years.
“A recent presentation by Tim Lawless of CoreLogic shows positive indicators including improved interstate migration and steady capital gains across the coast of 5.5%.
“The Sunshine Coast’s median house price of $579,526 is attractive to southern buyers, with Sydney’s house price now over $1 million and Melbourne not far behind.”
Market Place4 years ago
Australia’s Housing market
Market Place5 months ago
Inside the Gold Coast’s biggest property sales of 2017
Commercial Property8 months ago
Construction Under Way On New Hope Island Shopping Centre
Developments4 months ago
Find out what’s tipped to define the Gold Coast market in 2018
Market Place4 months ago
A coastal Queensland property was viewed by prospective buyers more than any other in Australia
Market Place4 months ago
Seaside suburbs the star performers of southeast Queensland property market
Market Place4 months ago
The Gold and Sunshine Coast markets are making a comeback
Market Place4 months ago
Southern buyers to fly to Gold Coast for Australia’s biggest auction event of the year