The Real Estate Institute of Queensland (REIQ) is urging the state government to follow the footsteps of New South Wales in introducing stamp duty relief to boost the local economy.
Antonia Mercorella, CEO of REIQ, said while several factors, such as low interest rates, housing support schemes, and loan repayment holidays, are supporting the economy and the housing market, the state needs to roll out policies to moderate the risks of high unemployment and weak consumer confidence.
"With Queensland's unemployment currently at 7.7%, consumer sentiment down 5.8 points this month and the latest consumer price index figures plummeting to a record 72-year low, any significant drops in property prices will only adversely affect consumer confidence and further stymie economic growth," she said in a report in Elite Agent.
To be able to support Queensland's property market, the state government needs to consider the steps taken by New South Wales, Mercorella said.
The state government of New South Wales temporarily increased the price cap of newly constructed homes that will be exempt from stamp duty. Under the changes, first-home buyers will not be required to pay any stamp duty for newly-built homes worth up to $800,000. This translates to a saving of up to $31,335.
"These measures will help to protect the jobs of over 50,000 people who directly rely on our state's second-largest employment sector for work while continuing to deliver housing across Queensland's thousands of local communities," Mercorella said.
Furthermore, Mercorella believes these policies will be able to minimise the economic impacts of COVID-19 and will help strengthen activity in the housing market.
"A stable property market is critical to Queensland's economy during this unprecedented pandemic recession," she said.
Mercorella said while worst-case scenarios of deeper price falls are unlikely, it is still crucial for the state government to act to minimise the impacts of potential border closures and restrictions.
The Queensland government recently announced an extension of border closure to New South Wales and the Australian Capital Territory to prevent the spread of COVID-19. Border closure to Victoria is also in effect, given the increasing cases in Melbourne.
"A widespread second wave of COVID-19 infections coupled with the potential for renewed border closures and stricter lockdowns will derail Queensland's economic recovery. Timing is everything. That's why we need urgent action now that will have an immediate effect," Mercorella said.
