Victorian confidence lags nation, with medium-term outlook improving

The latest ANZ/Property Council of Australia industry confidence survey highlights Victoria is lagging behind the rest of the country with a long way to go on the path to recovery.

Property industry confidence in Victoria is the lowest in the nation at 124 index points for the March 2021 quarter - below the national average of 142 index points. A score of 100 is considered neutral. However, medium-term outlook in Victoria is turning positive, with Victorians optimistic that the COVID-19 situation will improve over the next three months.

While Victorians demonstrated the lowest state growth expectations in the nation, they also reported the highest level of expected growth for Victoria since June 2018. Victorians also reported an improvement in capital growth expectations across all sectors, with the exception of the hotel sector, for the next 12 months.

The Property Council's Victorian Executive Director, Danni Hunter said that while currently low confidence remained a concern, the positive medium-term outlook was encouraging and should be leveraged by Government and the private sector to stimuluate economic recovery.

"Confience in Victoria is lagging the nation, but it is growing, and we should look to leverage the positive momentum that is just around the corder," said Ms Hunter.

"Government should parter with the private sector in a concerted effort to encourage workers back into Melbourne's CBD which will generate growth across the local and state economy, by stimulating consumer activity.

"Every one office worker generates enough activity to support the employment of another five people in our CBDs. Melbourne's CBD represents 24 per cent of the Victoria's economy and 7 per cent of Australia's economy. It is vital for Melbourne to resume to its pre-COVID glory."

The Property Council has also called on the State Government to work closely with the property and construction industry to increase housing supply and lock in Victorian jobs in the housing and construction sector.

"Nationally, housing supply and affordability were reported as being the number one critical issue for state governments to address. It is vital the Victorian Government works with industry to increase housing supply, maintain downward pressure on affordability and lock in Victorian jobs in the sector," said Ms Hunter.

To view select ANZ/Property Council Survey historical data series, visit the Property Council's Data Room