30
one business sector property owners
another.
in favour of
Neither am I convinced that such controls,
per se, are likely to have much, if any, effect on the general rate of inflation. I would also, at this juncture,
be concerned that the extension of rent controls to the
non-residential sector could result in a loss of confidence
in the construction industry, with a consequent channelling
away of investment in new buildings.
84.
As is customary in winding up the budget debate,
I would like to digress a little on the property market
generally, now that the results of the Commissioner of Rating
and Valuation's 1974 Property Review are to hand. Although
the supply of domestic accommodation in 1973 was, for a number
of reasons, rather less than expected, improved supply,
coupled with the tighter money situation, has resulted
generally in a topping out of rents and, towards the end of last year, there were clear indications of a downturn in
asking rents for new domestic premises, particularly in
the case of the more expensive type of accommodation.
Sale prices, too, are reportedly down by as much as 15 20%
over the year. Vacancies in the private sector in the
urban area, at just over 10,000 units, are the highest since
1968 having risen steadily from a low of 2,400 at the end of
1969 to 7,000 at the end of 1972; and thus I am fairly hopeful
that we shall see some further downward movement in domestic
rents over the year.
Honourable Members will recall that
we have already taken measures to impose full rates on
vacant domestic premises from 1st January last and these should
now be beginning to bite.
85.
In the case of retail trading premises, the position
is also similar for, although rents have continued on an
upward course over 1973, vacancies at the beginning of this year accounted for some 1.28 million square feet of space,
that is a 63% increase over the year, and this figure is
very nearly equal to the total space completed during the
year. Most of the vacant shops were located in the peripheral areas, thus tending to force down rents in these areas, but
there were also reports of rents being reduced in the more central shopping areas. There is likely to be an ample supply of new accommodation both this year and next.
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