On 21 May 2022, the federal political landscape changed, with the Albanese-led Australian Labor Party taking office, ending almost a decade of Coalition rule.
Here in Sydney’s Eastern Suburbs, we had our own ‘teal’ revolution with an environmentally-focused independent capturing the once Liberal Party stronghold of Wentworth.
The change of government could have real implications for our local property market. We explore what they are.
Labor’s real estate policies: the Help to Buy scheme
Housing affordability, especially here in Sydney, was a focus of both major parties in the lead up to the election.
If re-elected, the Morrison-led Coalition had pledged to enact a ‘Super Home Buyer Scheme’ policy, which would have allowed some first home buyers to pay for a home deposit by dipping into their super savings.
Meanwhile, the Labor Party launched the Help to Buy scheme, a policy that will see the government actually take a stake in people’s homes.
Under the scheme, the federal government will buy and own up to 30% of a first home owner’s property if it’s an established home – or as much as 40% if it’s a new home.
The government says this will allow first home buyers to get a foot on the property ladder much sooner and with a significantly smaller mortgage. The catch is that they’ll also have less equity – although they can eventually buy the government’s stake in the home back from them.
Help to Buy will be limited to 10,000 places a year and applicants must have an income below $90,000 if buying alone or $120,000 if buying jointly. The property they’re purchasing must also have a value of under $950,000 if it’s located in the Sydney metropolitan area.
That puts some homes in our area within first home buyers’ reach – the median price for a one-bedroom apartment in Potts Point is $850,000, according to Domain.
This could generate more activity in this part of the market, as long as buyers come in under the income thresholds.
Increased emphasis on sustainability
The rise of the teal independents and the performance of the Australian Greens – who now hold the balance of power in the Senate – means that we’re likely to see an increased emphasis on both sustainability and housing.
The Greens have a stated policy of building one million sustainable new homes across Australia. This includes 750,000 publicly-owned homes, 125,000 joint government/privately owned homes and 125,000 public universal-rental homes. They also pledge to create 135,000 construction industry jobs.
The Greens also have a policy for ‘renewable homes’, which includes offering homeowners grants for switching from fossil fuels to renewables, kickstarting a ‘battery revolution’ and banning gas.
The Greens’ housing and sustainability agenda is ambitious and it’s unlikely that all of it will all come to fruition. However, the fact that the government will need to negotiate with them to pass legislation means we could well see sustainable homes become a real focus over the next three years.
Meanwhile, our new local independent member, Allegra Spender, is also on board, stating that she will “support all Australians to make their homes and businesses more energy-efficient and cheaper to run”.
What will happen next?
The new government’s economic policies will also impact the housing market.
Currently, inflation is on the march, interest rates and living costs are rising, and global events are creating a new level of economic uncertainty. These factors have an impact right across the market, especially if buyers start to hold back, fearing falling prices.
Elections often bring a period of recalibration to the market, as people wait to see what happens. Right now, the property market is calmer than it was in 2021, which presents great conditions in which to buy or make your next property move, whether you’re upsizing or downsizing.
Contact our team today to find out more about how we can help you buy and sell in Potts Point, the Eastern Beaches and the Eastern Suburbs.