Election 2022 - What does Labor mean for Real Estate?

I have to be honest - right now, the interest rates are going up, but despite all the whispers, so is property.?The Brisbane market is holding steady.

We have come through the federal election and the country has not exploded.?Good news for most. What is still uncertain is the direction this new government will take with their policy and how this will affect our real estate market.

1. What is the labor government and what are its policies?

Traditionally, the Labor party’s policies are focused on social justice, equality, and opportunity for all Australians. This includes access to quality education and healthcare, support of workers’ rights and equal pay for women.?In a nutshell, it is committed to creating a fair and just society for all Australians.?The Labor Government have a goal to improve affordability and reduce homelessness.?It should be noted that Labor has been quite moderate and in many ways, essentially very similar in policy to the Liberal party.?However, with the huge wins by the Greens and Independent representatives, there will be some very strong voices pushing for social justice and serious action with regards to housing reform - in particular overall affordability.

2. What impact will the labor government have on the real estate industry in 2022?

At this point, there has been no discussion around changes to the current negative gearing legislation and as such, investors have certainty that it should continue into the foreseeable future.

This is not to rule out changes down the track as there is a strong push by the Greens to revive the conversation around limiting negative gearing.?They claim that the benefits are only really being reaped by the 10% of the ultra-wealthy, so we would be better off funding first home buyers over those purchasing their third or further investment properties.

Should there be an introduction of new taxes on investment properties and changes to negative gearing laws and foreign investment, you could expect a slowing of the housing market, as investors become wary of investing in property, yet an opening up to many who were previously unable to access the market.?Tightening of the foreign investment rules has the potential to decrease demand which in turn can lower property prices. Overall, changes in policies are likely to have a mixed impact on the real estate industry, with some positive and some negative effects.

3. How will this change the way people invest in property, and how will it affect house prices overall?

The change of government, at this point, really has very little impact on the real estate market right now.?As such, there will be little impact on the market.?There has been some signs that investors are keen to sell at this point, but again, this is not as a result of the current political climate.

4. Are there any other factors that could influence the real estate market in 2022 - such as interest rates or global economic conditions?

As discussed in my earlier market update this year, interest rates and the changes in the global economic climate have far more impact on our housing prices than our political leaders.

The rise in interest rates will be affecting homeowners and investors as their repayments will be increasing. The increases are however, in very small increments.?I did mention earlier there are investors selling in Brisbane and this is a direct result of the rising interest rates and a risk management strategy to take the capital and pay down other properties or the principal place of residence to avoid being over-extended.

Brisbane’s population is still growing with interstate sea-changers, international borders opening and the Olympics are still going to be a huge draw card. Of all the markets, Brisbane is a prime location and looks set to remain this way.

All in all, property is always a long term and safe investment.?Markets will always experience fluctuations, but as evidenced in Australia’s history - house prices generally go up.?If you seek advice from a professional Real Estate Agent, now is always the best time to buy.

Contact me today to discuss these factors and explore your property investment options.

Ryan Barabas of Elever Property Group is a leading professional in the Brisbane Property Market. For assistance with any matters regarding your property, do not hesitate to contact Ryan on 0439 715 742.