Property is Australia’s fountain of wealth. Attempts to solve the inflation crisis, such as the proposal to remove CGT, may have unintended consequences, warns Msquared Capital Co‑Founder and Fund Manager Paul Miron.
In an interview with Ausbiz, Paul says that solving the housing crisis requires a sharper focus on incentives for developers. High construction costs, labour shortages driven by major infrastructure projects, and migration levels that far exceed new housing supply are all constraining the market. Without meaningful policy support to bring new projects to market, the imbalance between supply and demand will persist.
Inflation crisis in numbers
- Inflation 3.8% driving interest rates up to 3.85%
- Up to 67% of Australian wealth is held in property, well above 50% OECD average
- Shortfall of 60,000 – 100,000 dwellings per year increasing inflation
- February inflation data saw housing the dominant inflationary force; a +6.8% house price increase, +32.2% electricity bill increase, and low vacancy rates driving rents higher.
Disclaimer
Msquared Capital Pty Ltd ACN 622 507 297 AFSL 520293. The information provided is general in nature and reflects the views of the speaker at the time of recording. Forward-looking information is inherently uncertain, and actual results may differ materially from projections. The information has been prepared without taking into account your objectives, financial situation or needs, and does not constitute personal financial product advice, investment advice or a recommendation. Before making any investment decision, you should consider whether the information is appropriate to your circumstances and seek independent financial advice. Property and private credit investments carry risks, including market downturns and borrower defaults, and neither past performance nor security over property guarantees future returns or capital protection.
