MID-YEAR BUDGET REVIEW 2018-9
Source: REIWA
Western Australia’s Treasurer Ben Wyatt has presented the Mid-Year Budget, with WA on track to reach a surplus by 2019-20.
Overall the outlook is optimistic for WA, largely due to the recent changes in how GST is distributed and the resources sector gaining momentum.
Economic indicators
- WA’s Gross State Product increased by 1.9 per cent in 2017-18 and is predicted to grow by three per cent in 2019-20 off the back of an improving resources sector.
- The WA labour market has improved more than expected since the Budget and has been revised up to 1.75 per cent in 2018-19 from 1.5 percent which translates to 23,000 finding work.
- WA’s population growth is expected to remain modest at 1.2 per cent in 2018-19, with natural increase continuing to be the largest contributor to growth.
Housing market
- Perth’s median house price has declined for the third consecutive year and is currently at -0.9 per cent annual growth, but is predicted to increase by 1.2 per cent in 2019-20.
- The Treasurer highlighted his concern that tightening lending criteria based on market conditions in the Eastern States could have an undesirable effect on the WA economy.
- Rental vacancy rate has fallen dramatically to 3.9 per cent, down from 7.3 per cent in June 2017.
First Home Owner Grant
We remain critical of this scheme as it penalises buyers of established properties. We will continue to advocate for the reintroduction of the $3,000 grant for eligible first home owners of established properties.
Funding boost to Keystart
As a decisive measure to increase housing affordability across the state, the WA Government has provided an additional $421 million to expand the lending capability of the scheme. This will boost the scheme’s capability to $4.8 billion. Based on the median value of loans, this extension equates to an additional 1,100 new mortgages.
We support additional funding but would also like to see the eligibility criteria expanded so more people can access home ownership via a Keystart home loan.
For more information, please contact REIWA Advocacy and Policy Manager Sadie Davidson on sadie.davidson@reiwa.com.au or 9380 8241.
