Further declines in transfer duty and land tax revenue are now expected for New South Wales and Victoria due to the weakening residential property market prices and falling sales volumes.
While, Queensland forecasts a decrease in average revenue growth over the period, reflecting lower income from GST.
The report also notes the larger states such as NSW, Victoria and Queensland as being vulnerable to rising health and education costs due to “recently experienced rapid population growth”.
House prices experiencing a correction
Almost all state capital cities are experiencing a house price correction.
Notably, NSW and Victoria housing markets are in decline after years of property price growth.
In Sydney, house prices, which rose rapidly over the five years to June 2017, declined by 4.22 per cent over the year to May 2018 and 6.08 per cent over the year to September 2018.
Melbourne’s housing market has cooled, but to a lesser extent than Sydney, with average prices increasing 2.22 per cent over the year to May 2018 but declining 3.37 per cent over the year to September 2018.