Property industry confidence across Australia has taken a significant hit, with Victoria falling into negative territory for the first time since the COVID-19 pandemic, according to the latest Procore/Property Council Survey.
The survey, which polled 532 Property Council of Australia members, revealed a sharp decline in industry confidence nationwide, with the Confidence Index dropping 14 points to 106 on a national level.
Mike Zorbas, Chief Executive of the Property Council of Australia, expressed concern over the steep drop in confidence across the property sector, which is Australia’s largest source of jobs.
“Industry is glass half empty on economic growth at both state and national levels, based on high taxing state budgets on the east coast and uncertainty on interest rates,” Zorbas stated.
The survey findings paint a grim picture of economic growth expectations, with both state and federal levels in negative territory at -16 and -24 respectively, where zero is considered neutral. Confidence in Australia’s two largest states saw significant declines, with New South Wales down 18 points and Victoria down 14 points.
Zorbas highlighted the alarming state of the housing sector, noting that “expectations for residential construction activity over the next 12 months are back below the historical average”.
This comes at a time when Australia is grappling with a housing crisis, prompting Zorbas to call on state Treasurers to address these housing and city planning gaps in their budgets.
The situation in Victoria is particularly concerning, with economic growth expectations 37 index points below its average and 58 index points below Western Australia’s result.
“Victoria’s property professionals are feeling as good as they were during the state’s second major pandemic lockdown, which further emphasises the need for the industry’s immense tax burden to be addressed,” Zorbas remarked.
Confidence levels across states varied:
- Victoria: Dropped into negative territory, falling 14 points to 90 on the confidence index
- New South Wales: Fell 18 points to 105
- Queensland: Dropped 14 points to 106
- ACT: Declined two points to 114
- South Australia: Decreased 18 points to 121
- Western Australia: The only state to see an increase, rising two points to 138
The survey results underscore the pressing need for state governments to reconsider their budgetary approaches and address the concerns of the property industry, particularly in light of the ongoing housing crisis and economic uncertainties.
