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Sunday, April 3, 2011

Housing property sales dip eats into budget

Housing property sales dip eats into budget ; Valuer General figures show 2556 properties were settled across the state - the lowest for any month since the Department for Transport, Energy and Infrastructure started keeping records in 1990.

The low sales numbers reflect the subdued state of the property market at the end of 2010, and are eating into the State Government's stamp duty revenue and budget bottom line.

Low sales volumes had forced Treasurer Jack Snelling to revise down by more than $140 million the conveyancing revenue the Government expected to receive to 2013-14. This figure could be revised down further.

The February settled sales included 1820 residential properties, 425 land sales and 311 other sales.

Real Estate Institute of SA president Greg Nybo said many property sales settled 30 to 60 days after a contract was signed and the figures showed the soft close to last year.

"There were some circumstances that prompted a fair bit of caution within the market," he said. "I think those numbers are genuinely a wash-up of events that occurred in the last quarter."

Mr Nybo said the November interest rate rise, the traditionally quiet Christmas period and a small pool of first-home buyers contributed to low numbers. "It's not surprising when you look at the total number of people that brought forward their purchase because of the additional first-home buyer grants," he said.

Upper House Independent and former Valuer General John Darley said the lower sales volumes could persist and create ongoing budget pressures.

"My personal view is that this market is going to be flat for the next five years," he said.

Brock Harcourts managing director Michael Brock, who was yesterday auctioning 10 units in the Cedar Apartments development at West Lakes, agreed November's interest rate rise had impacted SA's property market.

"People became scared it might not be the last and put a hold on purchasing decisions," he said.

But Lisa Petridis of West Lakes, who bought one of the units, said she hadn't been put off buying.

"I'm confident in the market," she said. For the latest updates PRESS CTR + D or visit Stock Market news Today

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