How will the slowdown in the apartment market affect the economy?
Australia's biggest apartment builder, billionaire Harry Triguboff, is worried about the slowdown in the apartment market and the severe impact it will have on the economy (and your super).
Mr Triguboff’s latest company figures show that sales have dropped over the past six months and overall prices are also down around 10 per cent.
The restrictions on capital flowing out of China, new limits being placed on investors seeking finance from local banks, poor domestic wage growth and the Government policies on taxing foreign investors have all contributed to this slowdown in the apartment industry.
“Australians could lose an enormous amount of wealth,” said Mr Triguboff.
These Government interventions were purposely designed to slow down the market. Until recently, annual prices were rising in double digit percentages, and Mr Triguboff is suggesting the industry is feeling the effects of this slowdown. There are even signs that apartment glut is beginning to strike, with more than 30 construction companies in Queensland alone going bust this year.
Mr Triguboff believes a review is in order to investigate the taxation policies for foreign investors. He also believes that more needs to be done to allow access to superannuation for housing purposes.
What do you think? Should we be more cautious about accepting foreign investment, and where possible, tax these investments heavily? Is a slowdown in the apartment market a good thing? What impact could this have on your superannuation funds going forward?