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Experts warned that the mass “hype” of Melbourne’s auction and opening of houses may be the disguise of the “fragile” market being covered by the smokescreen.
Simon Pressley, a market analyst and head of real estate research, said that compared with other capital cities, Melbourne’s economic weakness, population decline and record high rental supply paint a bleak picture.
He said that increasing construction efforts to increase the number of locked jobs is a dangerous move. He said that it may exacerbate the problem of oversupply and push the city’s market into a downturn, similar to the city’s housing prices from 2018 to 2019. The median plummeted 134,000.
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“The hype you see on an open house in Melbourne today is the same as the hype we saw on an open house in 2016, but those people hardly know who’s making a deal in 2016 is coming,” Said Mr. Presley.
Melbourne’s weak economy, declining population, record high rental supply and increasing new housing construction are a series of fundamental factors that are as weak as Darwin and Perth have seen in the past decade.
“If you consider all our capitals and all regions, and talk about all these factors that affect the real estate market, then Melbourne is just as vulnerable as the rest of Australia.”
CoreLogic’s Hedonic Home Value Index shows that the median house price in Melbourne is $744,679 and that in Victoria is $457,194.
CoreLogic director Tim Lawless told the Herald Sun earlier this month that the market is performing well Early signs of cooling Over the past six months, “unsustainable” capital gains have grown.
The Australian Bureau of Statistics data included in Propertyology’s latest report shows that Melbourne’s population has fallen by 26,000 in the past year.
Mr. Pressley said that, coupled with the decline in the number of interstate and overseas immigrants caused by COVID-19 and the impact of the city’s long-term blockade on the local economy, there is a real risk of overstimulating construction and construction that may inhibit housing demand.
Presley said: “Melbourne usually grows by about 100,000 people a year, rounding it up to a whole number, but this is not only not adding new recruits, but also losing more people.”
“There is a good balance. Every city needs to create jobs. The construction industry is an important industry in every city, but if you over-stimulate it, it will eventually lead to a downturn in the real estate market.”
The Herald Sun revealed on Saturday that landowners and home buyers will be Dragged down billions of dollars in additional taxes In the state budget on Thursday.
The increase in land tax will increase the tax rate of large assets worth more than US$1.8 million by at least 0.25%, and it is expected to receive US$1.5 billion in revenue within four years.
From July 1, homes valued at $2 million or more will be subject to stamp duty, and buyers are expected to pay up to 6.5% of the tax instead of 5.5%.
From July next year, a special windfall income tax will be imposed on the newly demarcated land.
The government has stated that it will apply to the total value increase of the rezoning of windfall income above 100,000 Australian dollars, and the 50% increase in profits above 500,000 Australian dollars.
A series of tax reforms is one of a series of measures aimed at raising nearly $2.7 billion in funds over the next four years.
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