DESPITE improving economic indicators, business confidence in the WA property sector has fallen marginally after steadying results over the past 12 months.
The ANZ/Property Council Survey index for WA for the March quarter 2019 is 129, which represents a one index point drop from the previous quarter – a score of 100 is considered neutral.
The WA property industry’s confidence index is 11 index points lower than the same time last year, but is higher than the national average of 123 index points.
Business confidence is significantly higher than two years ago when the WA index fell below 100 for three consecutive quarters.
Property Council executive director Sandra Brewer said industry confidence was affected in part by that of the general community.
“We are seeing that people in general are not quite certain where the market is going,” she said.
‘Our own polling indicates that younger people are more optimistic about growth in property prices this year, while older people are less so.
“The Federal election presents uncertainty, especially regarding proposed changes to negative gearing for investors, and the availability of finance is holding people back with people applying for loans being heavily scrutinised.”
Ms Brewer said confidence within the WA property sector remained strong, however the latest dip in sentiment also reflected an industry that was continuing to ride the bumpy road to WA’s full economic recovery, despite upticks across most property sectors.
“The latest survey reveals a continuing strong level of investment and work commitments in the industrial, retail and retirement sectors.
“The lift in growth expectations in the industrial sector is particularly telling as it indicates an increase in demand for our State’s resources.
“This, combined with more mining investment activity, supports a positive outlook for job and population growth into 2019, further strengthening our overall economy.”
Ms Brewer said expectations around economic growth were very positive and there had been an upward shift in sentiment in favour of the State Government’s performance.
“This is encouraging, and acknowledgement by our industry of the important steps the State Government has made in progressing major city building reforms such as strata reform and the review of the WA planning system,” she said.
“The message in these results is that the expected economic recovery in WA is still in its early stages but building momentum.
“It is now critical to continue to press on with important policy initiatives such as Infrastructure WA and Metronet, which will provide industry much needed certainty and lead the way to our State’s recovery.”