Drastic solutions needed to resurrect New South Wales housing market, warns independent investor group

Independent advocate group, the Property Investors Association of Australia (PIAA), has called on the New South Wales government to urgently address the state of the property market.

John Moore, President of PIAA, says the exodus from New South Wales into other states will increase, unless the Government acts urgently to encourage investment.

“The Government is not encouraging population growth in NSW which is vital to the health of the economy. To increase investment the Government needs to compete with the attractiveness of other states,” he says.

“Given we can’t match capital growth we need further incentives such as the removal of land tax and potential subsidies.”

“With housing affordability at its lowest level for 30 years, potential first homebuyers are being driven to rent – which is also becoming untenable - or leave the state altogether,” he says. “The legacy of the NSW Government’s exit and land taxes has blunted investment.”

Mr Moore applauds stimulus plans such as those proposed this week by the Property Council of Australia.

“Figures from the Reserve bank show that rents haven’t moved in line with housing prices. Since the mid-1990s, rents have increased only 35% whilst house prices have moved 175%.

“The Property Council of Australia’s research supports these conclusions. Their plan to eliminate stamp duty on new dwellings is only part of the solution.

“The Government must act now to reverse the decline of the market, or watch as the entire state continues to suffer,” he says.