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Why does property confidence matter to Queensland?

By Greg Bell

Confidence is something of a buzzword in the commercial property sector. Knowing that people and industry have a positive outlook on the future has various implications, from making sure projects are given the go ahead, to being safe in the knowledge there will be someone willing to purchase them upon completion.

It's therefore good news for commercial property for sale on the Gold Coast that confidence seems to be improving throughout Queensland. Although there are many indicators available, one of the most recent is the ANZ/Property Council Survey, which considers the property sector's views over the final three months of the year.

What does the index say?

Final quarter results place Queensland at 132 points on the confidence index – that's a two-point improvement on the third quarter of this year. Although this might not seem impressive at face value, it is important to remember some of the challenges Australia has faced over the given time period.

Not only was there the Chinese stock market crash, but also concerns about the Greek debt crisis. Closer to home, Australia welcomed its fourth prime minister in four years, which is likely to have caused some anxiety over the stability of the country's political system.

In light of all this, the Queensland property sector has nevertheless remained fairly upbeat. A reading of 100 is considered neutral, so this goes to show how positive the outlook currently is throughout the Sunshine State.

More than 2,200 industry representatives from across the nation took part in the survey, which is widely considered to be one of the leading indicators of confidence in the sector.

How does Queensland compare?

It's perhaps also a good idea to assess how well Queensland compares to its counterparts. The Property Council of Australia emphasised that while the state has some way to go before it catches up with New South Wales, there is still reason for optimism.

"With a 12-point gap in confidence levels between Queensland and New South Wales, it is clear that more needs to be done in Queensland to achieve favourable regulatory settings," said Queensland executive director of the Property Council, Chris Mountford.

Meanwhile, state treasurer Curtis Pitt emphasised that Queensland has plenty to look forward to in the future, which has the potential to improve its index reading even further. The implementation of economic policies relating to the property sector are also expected to leave a positive impression on the industry as a whole.

Mr Mountford agreed, indicating that government policies are going to have a significant impact on industry confidence over the next few quarters.

What's around the corner?

As the summer months take hold, it will be interesting to see how the property industry reacts. This is typically a time of year when retail leasing on the Gold Coast is especially strong, so this will prove a real test as to how well the market is performing.

Mr Pitt pointed towards a strong pipeline of activity over the coming years, which has the potential to make Queensland an even more appealing destination. Not only will construction activity pick up pace, but there will also be increased opportunities for employment in the Sunshine State.

If these projects do come to light, then there's every possibility this will be positively reflected in future confidence surveys. The key now will be to ensure momentum can be maintained beyond the next six months or more.

For the time being at least, Queensland needs to make the most of this positivity and make sure it translates into greater opportunities for commercial development throughout the state.

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