The headlines have been awash with the 2015-2016 Federal budget over the past couple of weeks. Following the Reserve Bank’s decision to cut the official cash rate to just 2 per cent, it looks like the government is also keen to encourage further economic growth.
The budget touched on a wide array of issues, covering everything from family support and foreign investment, to small business and employment. Fortunately for those taking out a home loan in the booming Sydney market, the building and construction industry looks to have come out a winner.
In a May 12 address, Treasurer Joe Hockey highlighted many of the hurdles that the Australian economy will come up against. Most significant of these is a rapid decline in investment in the mining industry, which is expected to drop off by around 25 per cent over 2015-2016. Mr Hockey said the budget is designed to help other sectors fill the gap left behind – something that many commentators say the real estate industry can achieve.
Building up the boom
For households, investors and prospective buyers alike, this is a great time to take stock and get an idea of where the Australian economy is headed over the coming months – and the outlook appears bright for the property market in Sydney. Many commentators have been calling for measures to improve confidence in the building industry and it seems as though the government has heeded these wishes.
The Housing Industry Association (HIA) said the tax cuts available to small businesses will be a big boost to the construction sector across the country, which has positive implications for a continued supply of homes.
“The $5.5 billion ‘Growing jobs and small business package’ provides important support to a wide-ranging group of small businesses in the residential construction industry,” said HIA Chief Executive, Industry Policy and Media Relations, Graham Wolfe.
Master Builders Australia also commended the government in this area of the budget, noting that the measures would help improve confidence for homebuyers, consumer and companies alike, as well as boosting job creation and spurring further building activity. Each of these elements is crucial to further growth and affordability in the housing industry, which is something that those taking out a home loan in the Harbour City will likely welcome with open arms.
In a May 12 release, Chief Economist at Master Builders Peter Jones said the policies outlined in the budget were long overdue, as the latest housing finance figures from the Australian Bureau of Statistics revealed a dip in the number of commitments taken out for new homes in March.
It looks as though the budget has come at the nick of time – and Sydney’s real estate market could feel the benefits. If you’d like to take the opportunity to pick up a home in the New South Wales capital, touch base with our team of home loan experts at Police Bank.