Ignore the FUD the next 2-3 will be the year to accumulate
Owners pre-budget night have been gifted a forever collateral piggy-bank. Those who have been gifted negative gearing won’t sell, they will just refi, drawdown to maximise NG tax benefits, and concentrate their wealth in the fanciest PPOR they can afford in a tax free shelter.
Rents are already going up. Ignore the bs around oh there’s a limit to how much people can afford etc. if tenants can’t afford it they just get pushed further out. No sign of decelerating immigration numbers either. There’s always fresh demand.
Yields up + supply down + demand stable = this naturally raises the floor price unless demand drops drastically.
You might see some overleveraged stock come on the market for a fire sale. People have equity in their existing portfolios. They will refinance those scoop those up. Increase rents, gear their new collection positively. HODL until CG makes sense to sell, or never sell and pass those along to children. All the while maximising NG in their existing grandfathered portfolios.
Interest rates will fall, one day, maybe another 3 years before we get our first cut. I don’t see how these changes crash property prices. Especially given the impact on supply it will have.
Oh but there will be a new influx of supply! They take years to come on market. We will see those come on coincident with the next rate cutting cycle. Even now, they’re already marked up and unaffordable for first home buyers.
And guess what, a development boom typically entails the parabolic price gain phase of the property cycle. Land prices boom, cost of labour, materials skyrocket, OTP prices go up and drag existing stock up as well. We saw this repeat already several times in Sydney just past 15 years or so.
Perhaps I reckon just a small dip, or a few years of no price rises at best. Final chance to get on the ladder (or what semblance of it is remaining) When the next rate cutting cycle begins, oh boy.