CEO’s Message – 31.07.2020
NSW Government needs to act now
It has been a big week for property development with the recent announcements on first home buyer stamp duty concession increasing and the 50% discount on land tax for Build-to-Rent (BtR) developments. There is a lot more to be done to stimulate growth in the BtR market and I will leave that for today and encourage you to attend our Build to Rent focused episode of UDIA TV on 13th August which includes the UDIA Roy Sheargold scholarship project, which provides a financial feasibility study of the Build to Rent sector in Sydney.
NSW Government has recognised that our sector is essential, but the measures that have been announced are measures that we needed pre-COVID-19. They are not enough to drive the housing led recovery we all want to see beyond COVID-19 in NSW.
With dwelling approvals still declining, in a years’ time, there will be so few projects ready to commence that we will not be able to bring jobs to the table. Just today, ABS released their monthly dwelling approval data, showing that, in seasonally adjusted terms, approvals for private sector houses in NSW fell 14.8 per cent in June. We are deeply concerned.
Treasurer Perrottet recently reported that from March to May this year, over 260,000 fewer people are employed in NSW. Conditions from eased COVID restrictions in June clawed back an additional 80,000 jobs in NSW, but even the most optimistic of us aren’t prepared to dismiss the possibility of a second wave as we have seen in Victoria.
We are grateful to see the extension of JobKeeper stimulus, albeit based on reducing support, until March 2021. This extension gives us time to plan, and it gives NSW Government time to step up and bring meaningful stimulus to the table for our sector. The development industry currently employs 25% of the State, the largest employer by industry.
This is why we are calling for more stimulus. It is imperative on the NSW Government to keep the development & construction sector delivering for the economy. UDIA NSW is calling for more stimulus across a broad range of homebuyer profiles, not just First Home Buyers (FHB), a segment which currently sits at approximately a quarter of the market.
Our research shows that previous stimulus packages, geared only to First Home Buyers, has doubled the purchasers from this cohort, but there this is not enough to drive stimulus across new home buyer market.
UDIA NSW has been advocating for State-based stimulus package, including stamp duty concessions, through our COVID-19 recovery road map, Project Bounce Back. UDIA NSW’s COVID-19 recovery recommendations also included an extension of stamp duty relief to all homebuyers for new builds for at least 24 months.
We will be continuing our advocacy to increase the stimulus measures from State government.