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Methven Mt Evelyn
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03 5963 4491Contact us
With Federal and State Government budgets and a reduction of .50 percent in the official cash rate by the Reserve Bank, there has been plenty for the financially literate to consider of late. We are sure even those with the narrow ‘hip pocket’ perspective have been paying some attention. Without looking at the broader issues let’s look at what it may mean for real estate.
It is the State Government more than the Federal Government that concerns itself directly with real estate policy, not surprising, given that stamp duty is a major source of income for the State ($1,691 million for the half year). The Federal Government however sets the economic mood of the country and the relief to families together with a lowering of interest rates may improve confidence.
The REIV welcomed the priority placed on ensuring economic growth in the Victorian budget. A healthy property market is dependent on a healthy economy. There have been changes to the way first home buyers will be assisted. The grant of $7000 on first homes up to $750,000 remains with no scheduled end date.
For first home buyers there is also a 20 percent reduction in Stamp Duty on homes up to $600,000 with an increase to 30 percent on 1 January 2013, 40 percent 1 January 2014 and then 50 percent 1 September 2014. From 1 July 2012 the First Home Buyer Bonus on new homes ($13,000) will no longer be available.
Since the recent interest rate cut there has been an increase in auction clearance rates across Melbourne. Clearance rates are now back over 60 percent having fallen as low as 54 percent a month or so ago. According to the Australian Bureau of Statistics Melbourne prices have fallen 8.2 percent since their peak in June 2010. Perhaps this together with interest rate reduction and a bit more confidence is bringing buyers back into the market.
For up to the minute advice please call your local office and speak with one of our consultants.