According to the latest ANZ/Property Council Survey, which measures confidence and sentiment, the industry has gained 13 index points to 128.
This is the second-largest quarterly increase since the survey’s inception. A score of 100 index points is considered neutral.
Confidence in the market has grown for investors in all states and territories, excluding the ACT, where consumer confidence has fallen by 13 index points.
Gains were at their strongest in South Australia, followed by WA, Victoria, NSW and Queensland.
Property Council chief executive Ken Morrison believes a combination of factors have led to the consumer sentiment around property growing.
“Following the federal election, we have had a quadrella of positive policy news, which translated into a strong sentiment bounce: certainty on negative gearing and capital gains tax changes, an interest rate cut, APRA’s lending standards review and the proposed first home buyers loan deposit scheme,” said Mr Morrison.
ANZ head of Australian Economics, David Plank, commented: “Since April we’ve been flagging that there were emerging signs of stability in the residential property market. In particular, we noted the fact that pace of house prices declines was slowing and that the auction clearance rate was beginning to rise.
Tax increases and a weaker Australian economy as a whole are key issues facing the property industry in 2019. The report also outlined an increase in taxes as a potential threat to long-term growth in the sector.
“However, the property sector is not immune from the challenges facing the rest of the economy and a number of state governments have just embarked on a range of investment-sapping tax increases.
“State budgets in Queensland, Victoria and South Australia have hit the property industry with arbitrary and poorly designed tax increases, which will hurt investment and job creation and risk undermining the current sentiment turnaround,” Mr Morrison said.