The 2019 Federal Election is to be held on Saturday 18 May. We wanted to help you come to a better-informed decision by providing the latest, and best, details available on all the promises.
There are many promises which seem too good to be true, but one thing is for sure: there are many promises that come into play that will affect the property market. Both residential and commercial markets will feel the changes, especially if there is a Labor win.
Both key sides have gone into this campaign with announcements and promises, and the biggest problem the government face once the election is over is a) if the Coalition have a win, they will then need to action their recent budget promises, b) if Labor wins, they will need to action a lot of very ambitious promises.
The biggest talk points for this election are negative gearing and other taxes, climate change, industrial relations, and education. The entire election of promises has been driven by assumptions that everyday Australians simply do not understand.
If we take a closer look at the policies being presented concerning the property market, we can see that the most significant changes will take place if Labor succeeds at the election. Why is this so?
The polls currently predict a Labor win; however, if this happens, they plan to scrap negative gearing for existing properties. Labor also has a plan to halve the CGT discount from 50% to 25%. If this happens, it will affect more than 1.25 million Australians who currently negatively gear investment properties. This will quickly lead to higher national rent prices and lower property prices across the board.
For new property investors, this is great news. For brand new properties, there are no expected changes. For investors who currently own properties, the benefits from the scheme will remain. In theory with these changes, property prices could fall by up to 12% by 2022, as investors will need to call for discounts that balance the absence of previously available concessions.
If we have an LNP win, housing prices are expected to rise 8%-14% in the same time frame. This could, however, spur the Reserve Bank to lower interest rates.
The biggest changes in the property market that will come with these changes, is there will be far fewer properties to choose from, more new property buyers in the market, and far better opportunities to build new multiple occupancy buildings to maximise land purchases.