Joel Davis,
Strategic Director at Image Property.
Wage subsidy extension more good news for southeast?
Property prices across many parts of Southeast Queensland have been strengthening for the past year or two.
The onset of coronavirus saw the market take a temporary pause but there is currently robust demand from buyers.
We started to see enquiries and activity begin to strengthen in the southeast from about May, which was also a moment in time when were still unsure how long the lockdown would last or its ultimate economic fallout.
Of course, Queensland is now in pole position compared to many other locations around the nation, given the low number of coronavirus cases we currently have.
With our domestic borders now open, we have started to see our local economy rebound with more people eating out and more bookings at myriad tourism locations across the State.
All of these factors are good news for our economy and for our property markets.
Now there is more positive news with the Federal Government announcing that the JobKeeper wage subsidy program has been extended beyond September for six more months.
The extended program will see a reduction in the fortnightly payments as well as tighter eligibility criteria, however, that will mean that the subsidy is going to the people who continue to need it.
How will the extension benefit property?
There had been some conjecture about a metaphorical property price cliff since the pandemic began.
In some quarters, potential buyers were biding their time while they waited for a surge of distressed sales at the end of September, which was when JobKeeper was originally slated to cease.
Educated property people knew this was unlikely to ever happen for a number of reasons, including mortgage repayment pauses.
Now, the wage subsidy extension provides yet another layer of certainty for buyers and sellers.
We now know that eligible businesses and employees will continue to be financially supported until March next year if their income has been significantly impacted by the pandemic.
Of course, amongst these people are property owners, would-be buyers, and sellers, as well as tenants and landlords.
The extension of JobKeeper means that each and every one of these people will receive government financial support to possibly see them through until March next year if they are eligible.
Many other nations would love to have access to such a program but could never afford it.
The fact that our nation can provide this financial support to its citizens is something that should be applauded by us all.
Indeed, the extension of JobKeeper and the continuation of mortgage repayment pauses, will both help to prevent a protracted economic downturn – including underpinning property prices in the months ahead.
