Property powers the economy

THE Western Australian property industry is the largest employer in the state, generating $9.4 billion in wages and salaries, but industry regulation is impeding further growth, according to new research by the Urban Development Institute of Australia.

The UDIA released its Property Development Industry Economic Impact Study early this week, which illustrates the economic impact of the property sector on the state’s wider economy.

The report showed the property development industry accounted for 55 per cent of all investment in WA and contributed $22.5 billion to the state’s economic output in 2007-08.

UDIA Western Australia chief executive Debra Goostrey said in a statement the study found WA’s property industry directly employed 123,600 people in the state during 2007-08, equating to $5.7 billion in wages and salaries.

“If you take into account the indirect or flow on jobs from the industry, this figure is in the order of $9.3 billion,” Ms Goostrey said.

The report also said $492.2 million in state taxes was also generated by development industry activities.

“The estimate on taxes is conservative given it does not include land tax or GST,” Ms Goostrey said.

“Overall these figures reflect the critical importance of the property industry to WA’s economy.

“Therefore the health of the industry is paramount to ensuring strong growth in the state.

Ms Goostrey said the study showed UDIA members were concerned regulation was a key impediment for further growth in the property sector.

“It has been proven that delays in the approvals process cost money and impact on land supply,” Ms Goostrey said.

“A six month delay in final approvals adds approximately seven per cent to the cost of an average priced lot.

“This equates to an extra $16,825 on the cost of a lot based on the December quarter average lot price of $240,371.

“The reform agenda should assist with unblocking delays caused by duplication and conflicting government requirements.