Page 4082 - Week 13 - Wednesday, 13 December 2006
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It is interesting, though, that, even in an environment where we have the highest number of housing finance commitments and the greatest increase in the rate of house construction out of the slump that we have experienced, the median house price in the ACT has moved from second highest in Australia to fifth. We are now fifth. This is interesting. I have been trying to get Ross Solly and the ABC to run some of these numbers, but they seem almost ideologically opposed to the good news.
Mr Mulcahy: He doesn’t want to lose his audience.
MR STANHOPE: That is exactly right—of two. We have moved from second on median house prices to fifth. We are now fifth, behind Sydney, Perth, Darwin and Melbourne. That occurs in the context of some misinformation—almost pathology—around Canberra and its affordability. The ACT now has the fourth lowest median house price of the capital cities in Australia. That is very significant.
In this debate about real estate affordability, with the “We’ll all be rooned” Hanrahans that are out there in relation to these issues, it is also interesting that you never see the Real Estate Institute of Australia—you never see my good friend Peter Blackshaw—actually refer to this particular figure: the average annual return on a three-bedroom investment house in Canberra, as recently as the last quarter, was 10.9 per cent. The third highest level of return on a three-bedroom investment house in Australia is achieved in Canberra, at 10.9 per cent—third only to Perth and Hobart. The average annual return on a two-bedroom dwelling in Canberra in that quarter was 7.8 per cent, as against 2.1 per cent in Sydney, for instance.
I am not sure where this flood of investors out of Canberra is going. It is flooding off to invest in housing in a city with significantly lower annual returns, according to the Real Estate Institute of Australia. There is a flood of investment from Canberra at 10.9 per cent to a far lower level of investment return in Sydney? I hardly think so.
The figures of the Real Estate Institute of Australia disprove the claims that are being made around the extent to which investors are packing up and leaving because Canberra is not the place in which to invest in real estate. The Real Estate Institute of Australia will tell you that it is the third best place in Australia to invest in terms of returns; those are the numbers of the Real Estate Institute of Australia.
I turn to the supplementary. Of course, I need hours. Once anybody asks me a question about the strength of the ACT economy, it does deserve or demand absolutely hours in response. The level of economic activity in the ACT in 2006 is simply unprecedented. The volume of private business investment in the ACT has grown by 38 per cent over the year to September 2006, to a record volume of investment of $2.2 billion. In the 21 years that the Australian Bureau of Statistics has been compiling estimates of investment by state, the only time the ACT has recorded growth similar to this was during the time of the construction of the new parliament house.
The level and growth of private business investment are, I think we would all agree, easily the best measure of confidence in an economy, not just now but well into the future. The trend level of employment in November 2006, for example, is 190,700, an
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