March has been a big month when it comes to changes that may have an impact on your financial world.
As your team of expert financial professional, we thought we’d break down these changes – both proposed and realised – and provide you with an overview of what they may mean for your financial world.
This Q&A covers the following topics:
- The Australian property slump
- Labor’s proposed franking credit policy
- Price increases for income protection premiums
The Australian Property Slump
There has been a lot of buzz in the Australian media recently surrounding the falling prices of property in many of our major cities. According to the Australian Bureau of Statistics’ Residential Property Price Index, prices fell 5.1 per cent on average across Australia in the whole of 2018, with home prices in the capital cities falling by 2.4 per cent on average in the three months to December.
As expected, this drop in the December quarter was worst in Sydney, with a fall of 3.7 per cent, and Melbourne, with a 2.4 per cent fall. Brisbane fell by 1.1 per cent. However, both Sydney and Melbourne have experienced unprecedented growth in the last 5 years, with the median dwelling price increasing in Sydney by up to 70% and in Melbourne by 41.5%. This drop, then, could be considered a return to normalcy after an unsustainable property bubble burst.
There has also been an increase in the number of houses for sale since January 2018, with Melbourne experiencing a significant 42% increase and Sydney following behind at 22%. On the other hand, Brisbane has only seen an 8% increase in the number of houses on the market. This equates to roughly 31,000 homes for sale across Brisbane. But while there are more homes for sale in Brisbane, Queensland led the nation in net interstate migration over the past year. This means that vacancy rates are on track to fall as the population increase fills those empty homes.