Tasmania Outlook Changing Market Conditions Interest rates are expected to increase before the end of 2011, by between 0.2 and 0.5 per cent. Based on the survey, 75 per cent of Tasmanian respondents thought they would increase and 25 per cent thought they would remain unchanged. The Government’s move to introduce a carbon tax is not supported by First National members, primarily as a result of concerns about the impact on confidence, the economy, saleability of existing housing stock, and values. However, more customers will seek energy efficient features when looking to buy a new home, due to rising household energy costs and the challenge of maintaining a healthy home budget. Homeowners will also be more likely to take action to begin correcting the least energy efficient aspects of their property. It was considered that Stamp Duty should be abolished altogether as it is an inefficient tax and does not serve the property market in any real positive sense – although it does help fill the coffers of Government. Property prices have risen significantly in the past 9-10 years and the Stamp Duty scales have remained the same. If Stamp Duty was abolished altogether, this would definitely stimulate the housing economy. Government should also not consider replacing stamp duty with another form of tax, like an across-the-board land tax or death duties. The introduction of a new tax coupled with the rising costs of electricity, water/sewerage charges and the possibility of further interest rate rises will put a strain on Tasmanian households. Members believe that any talk of abolishing negative gearing should cease immediately. Lower immigration levels would certainly impact on the Tasmanian property market and the Government should not look at lowering them. The population has remained stagnant for a few years with families leaving the state in search of ‘greener pastures’. New immigrants are supplementing what the state is losing and, in turn, bringing skilled labour to the state which it seems to be lacking, according to recent media reports.
38 First National Real Estate 2011 Property Market Outlook