This Saturday as voters from around the country cram into their local Primary Schools, reaping the benefits of the sausage sizzle, some are unaware of the impacts their vote could have on the Australian economy. With the Australian 2016 Federal Election just a week after Brexit, it is vital that Australians educate themselves on the policies of each party and how they can impact our country financially.
Real estate industry experts have spoken out on their concerns and according to the Real Estate Institute of Australia, housing investment is a significant contributor to the recovery of Australia’s economy, as it transitions away from resource investment to other drivers of growth. Leaders in the industry believe implementing Labor’s policy on negative gearing will put Australia’s economic recovery at risk.
“Australia’s property industry is the main driver of economic growth and increased employment in the transition away from a decade-long reliance on mining, and whilst it is expected that the weakening Australian dollar will provide a much needed stimulus to a number of sectors, the impact of this is still some time away” said Mr Neville Sanders, President of the REIA.
According to First National Real Estate Chief Executive Ray Ellis, the Australian property industry “is Australia’s largest employer, currently employing 1.1 million people and providing jobs for one in eight working Australians. If it is adversely affected then every Australian will suffer, either directly or indirectly”.
Should Australians implement Labor’s policy on negative gearing, Craig Gillies, Sales Director, Coronis Realty says that “it is estimated that some $19bn will be slashed from Australia’s GDP.” He added “reduced overall economic activity means more failing businesses and fewer jobs, and this affects everyone.”
The Real Estate Institute of Queensland believes that although there are housing markets south of the border that are overvalued, Queensland voters need to be cautious against trying to redress that balance by voting to abolish negative gearing in this weekend’s federal election.
REIQ CEO Antonia Mercorella said the commentary and public debate around reasons to get rid of negative gearing were all focused on Sydney and Melbourne housing prices and affordability issues. She urges Queensland voters not to be “swayed to vote on negative gearing issue without fully understanding the impact it will have on the Queensland economy and Queensland home values.”
“Our economy is fragile right now and negative gearing serves valuable economic purposes – it encourages investment, it contributes to driving economic growth, it contributes to asset accumulation, it encourages entrepreneurship.”
“If we lose negative gearing, the impact in Queensland will be felt first by renters, with weekly rents going up by as much as 10 per cent according to some studies,” Ms Mercorella said
“With Britain opting to play with fire the consequences were swift and will continue to flow. Australians now have a chance to learn from making decisions on poorly thought out strategies and not create the devastation that would be the outcome of the Labor and Green’s policies on negative gearing and capital gains tax at this election,” concluded President of the REINSW, John Cunningham.