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Michael Talarico from Hilton Parkes First National expects the Plumpton property market to soften for the remainder of 2011, on the back of a steadying market over the first half of the year. “This will create an ideal market for investors, who could capitalise on lower house prices, increasing rents and improved yields,” Mr Talarico said in the network’s Property Outlook 2011 Mid Year Update released this week. “Housing affordability, the threat of interest rates increasing, reducing consumer confidence and tight lending criteria from major banks will help to moderate the market in the coming six months. “The general economy is expected to see land and apartment/strata property prices remain flat, while house prices are expected to trend downwards. “Any movements are expected to be between 1 and 5 per cent.” Mr Talarico believes the rental market is expected to weaken, with weekly rents trending downwards, decreasing by between 5 and 10 per cent, while vacancy rates are expected to ease, trending upwards and increasing by between 1 and 5 per cent. According to Mr Talarico investor activity is expected to increase by up to 1 per cent, however investors will monitor closely and be wary of changes to negative gearing and other tax reforms, which may impact on their interest levels. First home buyers are expected to represent the strongest growth in activity for the Plumpton region. 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 may seek energy efficient features when looking to buy a new home, due to the rising household energy costs and the challenge of maintaining a healthy home budget,” Mr Talarico said.

“Homeowners will also be more likely to take action to begin correcting the least energy efficient aspects of their property. “Although, this could be an each-way bet, but until the tax is introduced and the impacts felt, it is difficult to predict the outcome on property transactions.” Mr Talarico considers Stamp Duty should be abolished altogether, as it would deliver on the promise that indirect taxes such as Stamp Duty would be eliminated when the GST was introduced. “This should only happen as long as the mooted plans for replacing it with other taxes such as a broad-based land tax, including the family home, or death duties are not carried through,” Mr Talarico said. “Any talk of abolishing negative gearing should cease immediately.” Lower immigration levels would certainly impact on the property market – but impacts could be both positive and negative according to Mr Talarico. “Immigration has been a benefit to keeping housing strong during and post GFC, and the housing shortage continues to underpin market prices,” Mr Talarico said. “However, existing infrastructure is sagging under the pressure of the current population.” The exclusion of any of these proposed policy changes from the recently announced NSW state budget may be an indication that the Government does not intend to take such matters any further. “It is hoped that the change in NSW government will see some changes in planning policy to enable developers to release more land at a more affordable development cost and with reduced red tape,” Mr Talarico said. “There is, however, a budget loss to be recovered and this may impact on the ability of the new government to effectively move forward with their plans.” - copy ends – Issued by: First National Real Estate For further information or to receive a copy of the 2011 Property Outlook, Michael Talarico, Principal from Hilton Parkes First National, on 02 9832 3211

Plumpton, Hilton Parkes, NSW  
Plumpton, Hilton Parkes, NSW  

Plumpton, Hilton Parkes, NSW - Media Release