ACT Budget 2021: Property industry call for more clarity post June

Canberra’s property industry has welcomed the ACT Budget but called for more clarity once COVID-19-induced measures come to an end later this year to ensure the local economy remains afloat.

ACT chief minister Andrew Barr delivered the fiscal update on Tuesday, eight months after it was expected to be handed down due to the coronavirus pandemic.

In his address to the Legislative Assembly, Mr Barr said the Budget’s purpose was to “drive Canberra’s recovery from the COVID-19 pandemic”.

“This Budget sets out how we will help grow the ACT’s employment base with investments to support existing industries and grow new ones,” he said.

Of the six property-related measures in the territory’s Budget, it reiterated the city’s move to extend COVID-19 residential tenancy relief until June 30, 2021.

On top of this, the territory government’s temporary stamp duty waiver, which was announced in June last year as part of Canberra’s Recovery Plan, will also end on June 30, 2021.

Property Council of Australia ACT executive director Adina Cirson has urged the ACT government to “keep a watching brief on market conditions post-June 2021 and to not rule out further extending stimulus measures”.

“The government has noted that there is still a lot of uncertainty in the economy so winding back stimulus measures that have been effective in keeping our economy relatively stable … quite simply might be jumping the gun,” Ms Cirson said.

Master Builders ACT CEO Michael Hopkins called for more support for job growth in the capital once the measures expire later this year.

According to the Budget, more than 10,000 jobs in the ACT were lost as a result of the pandemic.

“Once the short-term benefits of economic stimulus wear off, economic reform will be needed to drive growth in the local economy,” he said.

Housing Industry Association ACT and Southern NSW executive director Greg Weller told Allhomes that while the stimulus measures have kept the economy buoyant, “we can’t have these forever”.

“The most important thing the government can do right now is ensure that we have a vibrant housing market and it is attractive for homebuyers and investors,” Mr Weller said.

“We’ve got to take a long-term view if we want something sustainable. We need to address challenges in all markets including the rental market, the construction industry and housing market.”

Ms Cirson added the ACT government was “not out of the woods yet”, noting that it should respond with continuing stimulus support if required.

“It’s the only way to ensure that the property and construction sector is best placed to help lead the economic recovery of Canberra,” she said.

The Budget noted that disruption to international travel would have significant effects for net overseas migration, with population growth to drop from 8000 persons per year to 3000.

Mr Hopkins said the slowing population growth “paints a concerning picture for the ACT economy”.

“[This will have a] direct and negative impact on industries, including the construction industry,” he said.

“We encourage the ACT government to continue to work closely with the local industry to ensure policies are implemented which create jobs, drive economic growth and support Canberrans into careers in the construction industry.”

Mr Weller said the drop in overseas migration would likely see house and rental prices stagnate with the lack of competition in the market.

“Despite this, interstate migration has been strong in the ACT … as long as the government works to ensure Canberra remains an attractive place for people to come and work and live.”