Last month, Australia's Clean Energy Future Bill passed through the senate and became law. The hotly-debated carbon tax is included in this piece of legislation, with commentators from a range of industries regularly debating the pros and cons of the new regulations. So, how will the carbon tax, which comes into force on July 1st 2012, affect Australia's property market - and more specifically, the price of new homes? According to Tim Parker, general manager of the energy, climate change and sustainability business for WSP Environment and Energy, the amount passed on to buyers will not be too high.
"Various industry studies have indicated the impact will be between 1.2 per cent and 1.7 per cent on the cost of new homes in Australia. This will depend on the extent of how suppliers pass the cost impacts through and the amount of products supplied from overseas," he stated. However, Mr Parker stressed there are genuine opportunities for the real estate sector to make the most of these price increases. He pointed out homeowners and businesses are becoming more concerned about the energy efficiency of properties, which is only likely to be bolstered by rising fuel prices.
Rick Otton, a property investment specialist, commented last month that the carbon tax could push investors towards existing houses, rather than new-build assets, due to the potential hike in prices. "As the time draws near for the introduction of the carbon tax, the penny will drop that if new home construction costs are to rise, then competition to buy existing homes will increase," he observed. Mr Otton added savvy investors should make a purchase now to avoid the rush further down the line. Meanwhile, research carried out by the Property Council of Australia found 49 per cent of those working in the real estate industry are against the carbon tax, compared to 33 per cent who support the legislation and 18 per cent who are neutral.
- Friday 16 December 2011