Superannuation Changes Spike the Supply Side

We are in the middle of yet another Government intervention changing the Supply curve for residential real estate in our primary eastern seaboard markets.

Students of the real estate markets will be intrigued as many of those approaching retirement age rush to bail out of their real estate investments between now and June 30 to take advantage of the relaxation of Superannuation provisions allowing individuals to place up to $1mil into their Superannuation accounts tax free.

Even though this will create Capital Gains Tax issues for most, the Financial Planning industry is busy making hay as lots of new money is pouring into Super.

The volume of property on the market has already started to grow. Australian Property Monitors reports that the number of homes sold through auction in February was the highest since the peak of the property boom in 2003. RP Data, one of Australia’s primary property statistics agencies, reported recently that during the past six months, excluding Christmas, the number of new listings in NSW has averaged 3042 a week. However in the week to March 11 there were 3983 new listings. "That's an increase of 31 per cent," says RP Data's chief executive, Graham Mirabito.

Property buyers in the primary markets are set to find themselves a bargain as the desperate sellers try to have their transactions completed by June 30. This will create a spike in the supply side of the real estate markets, driving downward pressures on prices, and creating as mini “buyers market”, at least until June 30.

After July 1, who knows what the Federal Government will do as the next Budget is due in May and as we all know, the rules governing Superannuation move with the political climate. Writer’s Bio

Geoff Stroud is the author of http://www.theshockingtruth.com.au The Shocking Truth Reports and the Sales & Marketing Manager of Ozinvest Pty Ltd, a 20 year supporter of the Brisbane property investment market. Ozinvest Pty Ltd provide brand new house and land package deals in Brisbane for real estate investment and offer themselves to property investors as the primary tenant for 10 years at fair market rental value. No OzInvest client has ever lost one day of fair market rent during the 10 year term of their leaseback arrangement. http://www.ozinvest.com.au