Millions of people make up the property market, but only a handful wield real power. For clues as to where property prices are heading, check out these 10 movers and shakers from Christopher’s Housing Boom and Bust Report:
10. Mark Steinert, Stockland CEO
With more than 82,000 residential lots and 3,000 retirement units in his company’s pipeline, Steinert is likely to continue calling for curbs to negative gearing on established properties, creating an advantage for new development. He’s got the political connections to make it happen, especially under a Labor government that promises to disallow negative gearing.
9. Bill Shorten, Opposition Leader
Negative gearing is a boon for investors, so Shorten’s plans to reduce this incentive would limit investor appetite. Property investors have anticipated a Labor election, so some of the concern about changes to negative gearing may already be priced into the market, cushioning further declines.
8. Daniel Andrews, Premier of Victoria
He’s the man in charge of Victoria’s land. If he releases more land for development, he would increase supply and potentially reduce property prices in the state. So far, his record has had a mixed effect on the market. In 2017, his new concessions on stamp duty boosted demand, but in 2016, new taxes on foreign buyers likely checked their interest.
7. Gladys Berejiklian, Premier of New South Wales
Like Andrews, Berejiklian wields immense power over real estate via the levers of taxes and development. One example: The light rail project in Sydney’s CBD and eastern suburbs, even with its delays, is likely to boost desire for nearby houses. Last year, the NSW government enacted an exemption and discounts on stamp duty to stimulate demand. Falling Sydney property prices hurt NSW coffers, so Berejiklian may be tempted to enact pro-development policies.
6. Donald Trump, U.S. President
The world’s most famous property developer implemented massive tax cuts in 2018, pushing U.S. and global interest rates higher.
Further rate increases remain a major risk for Australia because it is so closely tied to what happens in the United States.
5. Scott Morrison, Prime Minister
If Morrison hangs on to the Prime Minister’s seat, he is unlikely to limit negative gearing as severely as a Labor government would. But watch his moves on infrastructure projects, tax policy and immigration, all influential factors in property markets.
4. Brian Hartzer, Westpac CEO
As head of Australia’s second-largest mortgage lender, Hartzer isn’t the sole maestro of property markets, but he does help set the tempo. Westpac has raised rates outside of Reserve Bank of Australia moves, and in September curbed loans to riskier borrowers.
3. Matt Comyn, CEO of the Commonwealth Bank Australia
Australia’s largest residential lender also has increased rates separate from the RBA and tightened home-loan standards. Comyn may expand on those moves in 2019, but he’s still in the business of lending money, which limits chances of a credit crunch.
2. Wayne Byres, Chairman of the Australian Prudential Regulation Authority
APRA unleashed the current downturn in March 2017 when Byres told banks to reduce new interest-only loans to 30 percent from 40 percent of their portfolios. APRA says its decisions have improved credit quality, so it’s not clear whether further restrictions are looming.
1. Dr. Philip Lowe, Governor of the Reserve Bank of Australia
Will Lowe and the RBA cut rates to soften the housing downturn? Will he encourage APRA to loosen lending? The market will look to Lowe for answers to these and other crucial questions.
Next time you’re looking for clues as to where the property market is headed, it could be worthwhile looking to these 10 property market movers and shakers. For more on how to read or draw your own insights from the market, check out how to read the property cycle clock.
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