Rebuilding confidence in NSW

An important factor that pertains to property investment, commercial expansion and economic growth is consumer confidence – relating in particular to rebuilding confidence in NSW.

Sometimes favourable conditions in the market are not enough to bolster activity – residents need to feel assured that if they start investing their money in new projects, they will achieve positive returns.

Fortunately, New South Wales seems to be making gains in this regard.

The Property Council of Australia-ANZ Property Industry Confidence Survey released last week (April 19), revealed an increase in confidence from the March quarter to the June quarter.

The analysis measured responses from more than 2,300 construction and property professionals all across Australia – with 622 from NSW – and revealed an index that rose from 105 points to 113.

Property council acting NSW executive director Edward Palmisano was pleased with the report and credited the positive results with a better outlook on the world stage.

“The survey points to a gradual increase in rebuilding confidence in NSW, as the acute concerns over global economic conditions soften,” he said.

While the Housing Industry Association (HIA) calls for lower interest rates and policy changes to spur residential building growth, other bodies have pointed out positive aspects that are currently working for the buying side of the industry.

ANZ head of property research Paul Braddick referred to strong market fundamentals in both residential and commercial ventures that are leading to higher rents.

“Improved housing purchase affordability, tight market conditions and increasing rents should encourage both first home buyers and investors into the purchasing market,” he said.

The “cautious confidence” that the Property Council of Australia described may be attributed to the construction side of the property industry.

HIA chief economist Dr Harley Dale commented on the existing building climate: “Evidence of persistent weakness in Australia’s residential construction industry, especially new home building, should be a key concern for policy makers.”

By Steve McKnight

Steve McKnight, the founder of PropertyInvesting.com, is a respected property investing authority as well as Australia's #1 best-selling business author.