Perspective is key through the COVID-19 crisis, and although Victoria and New South Wales are battling to contain a second wave of the virus, we can’t lose sight of the fact that Australia still has some of the lowest rates of death and infection in the world. Our economy is also proving more resilient than those of our peers, and, barring a significant deterioration, should return to growth in the September quarter of 2020. The success of Australia’s stimulus package can be attributed to the way in which it was primarily funnelled through to direct payments for businesses and households. Overseas, stimulus packages have tended to rely more heavily on loans and grants, and those who are eligible often don’t apply. Here, stimulus payments have landed quickly and directly in bank accounts and that money has been more effective in supporting businesses and shoring up consumer demand through the pandemic.
The extension of both programs by the Federal Government, announced well ahead of their September expiry dates, is a welcome move and we’re confident that a further extension will be granted if and where necessary before the new deadline in March 2021.
Unsurprisingly residential property located in COVID-19 hotspots of Melbourne and Sydney saw demand and valuations for property decline. Adelaide however bucked the trend and was one of three cities to record house price growth over the June quarter.
Adelaide’s outlook for residential property has improved vastly in recent weeks, as sentiment towards buying a dwelling reaches a six-month high. Affordability is clearly front of mind for prospective buyers, with Adelaide offering one of the lowest purchase prices of all the capitals as well as offering buyers a great lifestyle.
More broadly, although panic selling of shares has slowed, we expect that the “road to recovery” will continue to be bumpy. Dividend payments from many of Australia’s largest companies will continue to remain under pressure and may be postponed in some circumstances. Interest rates will also remain low for the foreseeable future. To ensure we have a strong foundation in place to meet your goals, Synergy Private Wealth also aim to work with your current professional service providers, but may also suggest you seek additional guidance from one of our trusted partners who can provide specialist guidance regarding taxation, loan arrangements or your estate planning needs.
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