Following Labor’s failure to win the election, economists are forecasting a “moderate positive shock tpo sentiment in the corporate sector and a more meaningful one in the housing sector”.
According to the Property Council of Australia, the election results only shows that Australians had rejected risky taxation changes in the property cycle. Home prices have fallen as much as 14 per cent in Sydney with part of labor’s expected changes.
“A key plank of the Opposition’s policy agenda were big changes to negative gearing and big increases to capital gains tax, and the election result can only be seen as a repudiation of this policy," PCA chief executive Ken Morrison said.
Labor’s proposed changes were part of why the market has been dropping. Chairman of Australia’s biggest real estate agency group Ray White’s Brian White said that property was the decisive factor.
"Cycles are cycles but I do think what Labor was going to bring in has had a major impact on prices. Now that's not going to happen," Mr White said. "I think people will look back on this as the time when confidence started to come back into the market again. I think property was the most decisive election issue in the whole campaign."
Article source: https://www.afr.com/news/economy/labor-loss-to-deliver-a-positive-property-shock-20190519-p51ow6
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