REIQ responds to Banking Royal Commission report

05/02/2019

THE REIQ welcomes the finalisation of the Royal Commission into the banking and financial services sector and the release of its report.

It is now important that the government and regulators address the problems identified in the report without causing further damage to the property industry and broader economy.

The property industry is the backbone of the Australian economy. The residential property market is worth almost $7 trillion which is 3.5 times the size of the Australian stock market.

In Queensland, real estate is the lifeblood of the local economy, employing around 50,000 people and providing some the state’s largest revenue sources in the form of stamp duty and other property related taxes. A strong and stable real estate sector benefits all Queenslanders.

The property sector is already feeling the impact of the Royal Commission. Tightened lending criteria has seen borrowers locked out and property values in the capital cities of Sydney and Melbourne falling at significant levels.

These falling property values represent falling earnings for real estate agents and lost revenue for the small businesses – real estate agencies – that employ around 50,000 Queenslanders.

CoreLogic estimates real estate agents would have earned $1.28bn less in sales commissions last year, based on a 2.5 per cent commission rate.

This report is released at a time when consumer and business confidence in Queensland is already low. The looming federal election, with the threat of negative gearing changes and at a state level, the residential tenancies reforms, are all impacting buyer confidence and presenting a perfect storm for the Queensland property sector.

Confidence is key to real estate.

To maintain the health of the Queensland real estate sector – and the Queensland economy – it is important that Queenslanders are able to access finance so they can buy and sell property.

The REIQ is hoping for a balanced response from the finance sector, regulators and government, that ensures buyers with the capacity to service a mortgage are still able to access finance to buy property.

 

-ENDS-

Media enquiries:
REIQ Media and Communications Manager
Felicity Moore
T: 0408 020 428 E: media@reiq.com.au