Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

Joel Robinson

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

IN BRIEF

<ul>
	<li>
	Just three double-storey Sky Homes sit at the top of The Waterline, each with its own private marina berth and rooftop terrace.
	</li>
	<li>
	Construction on The Waterline is complete, with the first residents expected to move in from mid-October.
	</li>
	<li>
	Sky Homes range from 282 sqm to 367 sqm and are priced from $3.65 million.
	</li>
</ul>

<hr />
Lewis Land has opened the first completed sky home for inspection at Harbour Shores, giving buyers their first opportunity to step inside one of just three double-storey residences crowning The Waterline.

Each sky home comes with its own private marina berth, rooftop terrace and Broadwater views, combining the scale of a larger home with direct access to the boating lifestyle that underpins the wider <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan.

[smartcode_project:default project_id=113271 project_image_fid=366708]

Lewis Land Head of Development Michael Long said the inclusion of a berth with every Sky Home had become increasingly valuable as marina access across the Gold Coast tightened.

“Marina berths are becoming increasingly difficult to secure across the Gold Coast, so including one with every Sky Home makes this a genuinely rare offering,” Long said.

“The private 70-berth marina will accommodate boats up to 12 metres in length and is positioned just 2.5 kilometres from the Broadwater, placing the open ocean only 15 minutes away.

“Being able to step out of your home onto your boat is a rare luxury, and it’s something residents here can look forward to when it opens later this year.”

[smartcode_project:default project_id=113271 project_image_fid=366709]

The display opening comes as construction completes on The Waterline, with the first residents expected to move in from mid-October.

The three Sky Homes range from 282 sqm to 367 sqm and each feature three bedrooms, three bathrooms, multiple living zones, expansive kitchens with butler's pantries and large balconies taking in the Broadwater outlook.

Each residence also has three secure basement car spaces and additional storage.

“This is the first opportunity the Gold Coast has had to step into Harbour Shores and see, touch and feel what we’re bringing to life here,” Long said.

“There are only three Sky Homes within The Waterline, ranging in size from 282sqm to 367sqm, with each residence featuring three large bedrooms, three bathrooms, multiple living zones, expansive custom-built kitchens with butler’s pantry, and large balconies capturing Broadwater views.”

<img alt="Harbour Shores" data-entity-type="file" data-entity-uuid="bab65e10-4fab-45e1-92d8-fc56e2ab98ff" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-25%20at%202.00.16%E2%80%AFPM.png?VersionId=XT8q76LsPkw3cYTsvN3JfFDaPLud90PN" />

Residents of The Waterline will have access to a private pool, along with Harbour Shores' wider collection of amenity including a lagoon pool, social clubhouse, tennis court, gym, yoga facilities and sauna.

Lewis Land partnered with Studio Collective to furnish the completed display, with the interiors designed to demonstrate how the residences could function as permanent homes rather than simply as show apartments.

Studio Collective Director Melissa Park said the surrounding waterways informed the interiors, but in a more restrained way than a traditional coastal scheme.

“We drew inspiration from the canals and coastal surrounds, but our approach was to interpret that subtly through layered materials and a grounded palette of earthy tones, rather than literal coastal references,” Park said.

“We introduced hero moments of green and teal to reference the surrounding waterways, while mirrored elements help reflect natural light.

“The result is a residence that feels elevated yet comfortable, somewhere buyers can genuinely imagine themselves living, entertaining and unwinding.”

Sky Homes are priced from $3.65 million.

Lewis Land is also offering private marina berths with The Residences, its limited collection of three and four-bedroom villas positioned directly along the Harbour Shores waterfront boardwalk.

Three-bedroom villas are priced from $2.99 million, while four-bedroom residences start from $3.19 million.

Harbour Shores is being marketed by Colliers International.

[smartcode_project_cta:default project_id=113271]

Lewis Land opens sky home display as The Waterline completes at Harbour Shores

St Vincent de Paul Society Housing Australia has filed plans for a major mixed-use housing precinct on the southern edge of the North Sydney CBD, adding another significant proposal to a pocket around North Sydn​ey Station that is quickly becoming one of the LGA's busiest development zones.

The State Significant Development Application covers a 5,990 sqm site at <a href="https://www.apartments.com.au/new-apartments/1-19-mackenzie-street-lavender-bay-nsw-2060">1-19 MacKenzie Street and 211 Blues Point Road in Lavender Bay</a>, immediately south of Nor​th Sydney Station and between the commercial core and the lower-rise Lavender Bay Heritage Conservation Area.

Designed by Wardle, the proposal would deliver a new residential tower comprising 88 build-to-sell apartments and 19 affordable apartments, alongside a separate co-living building with 57 rooms and a building manager's studio.

It would also see the significant restoration and upgrade of St Francis Xavier Catholic Church, the adaptive reuse of the former school building, new parish facilities, retail, a new public square and around 1,000 sqm of publicly accessible open space.

<img alt="Vinnies North Sydney" data-entity-type="file" data-entity-uuid="d5dd7f87-a617-463e-b577-17541e01f0e9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.13%E2%80%AFAM.png?VersionId=4R8TsFN3P_LrrXO2HswTOIrx2blil8lh" />

The project is seeking a concurrent rezoning of the site to R4 High Density Residential and an increase in the maximum building height to allow a tower reaching RL120, or up to 20 storeys. The proposal was progressed through the NSW Government's Housing Delivery Authority pathway.

The build-to-sell component will be weighted toward larger apartments, with just six one-bedroom apartments compared with 31 two-beds, 43 three-beds and eight four-bedroom residences.

The 19 affordable apartments will comprise two studios, 15 one-bedroom apartments and two two-bedroom apartments, taking the total apartment component to 107 residences before the 58 co-living rooms are included.

<img alt="Vnnies" data-entity-type="file" data-entity-uuid="7d568ca5-cb90-4e18-96c6-d9795dba0c56" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.05%E2%80%AFAM.png?VersionId=GY2R5M9VtQh0EKy1vajaea19PSLOPuRD" />

Wardle's design for the Vinnies site has sought to negotiate that emerging high-rise context while retaining the lower-scale character of MacKenzie Street and the adjoining heritage conservation area.

The main building adopts a three-storey podium and tower arrangement, with the podium aligned to the ridgeline and front setback of St Francis Xavier Church.&nbsp;Wardle has designed the podium with colonnades, seating, recessed entries and active ground-floor frontages, with sandstone-toned precast concrete and face brick referencing the materiality of the existing church.

The tower then steps back eight metres to the south and six metres to the north before rising in a sculpted form comprising four interlocking quadrants. Wardle has also introduced rounded forms and chamfered corners to reduce the tower's perceived bulk and improve view sharing with neighbouring development sites.

Resident facilities and outdoor areas are planned at the separation between the podium and tower at Level 3, oriented toward Sydney Harbour and the CBD skyline.

The tower itself will feature a glass reinforced concrete facade, with recessed balconies and deep reveals used both to provide shading and privacy and frame views toward the harbour and city. The lower levels take a different architectural approach, using brick and sandstone-toned finishes intended to establish a stronger relationship with St Francis Xavier Church. The Church itself will be conserved and upgraded for its continued use, while the former school building will be adaptively reused as part of the co-living component.

<img alt="Lavendar Bay" data-entity-type="file" data-entity-uuid="2d4418ad-90aa-4d49-af93-c80b140aea80" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.09.47%E2%80%AFAM.png?VersionId=Kv4gzbsACaGvZSRuaqcfGC54jEJRXIDJ" />

&nbsp;

The proposal adds to an increasingly concentrated pipeline of residential development around Blue Street, MacKenzie Street and Lavender Bay.

Just west of the site, Central Element lodged plans earlier this year for one of the most significant residential developments proposed in Lavender Bay in recent years.

Central Element's SJB-designed scheme at 64-66 Lavender Street and 3-7 Middlemiss Street would deliver 163 apartments across two towers rising 23 and 32 storeys, replacing five existing apartment buildings containing 32 homes. The project also forms part of the Housing Delivery Authority pathway.

<a href="https://www.apartments.com.au/news/nsw/first-look-central-element-reveals-lavender-bay-apartment-plans?utm_source=chatgpt.com" rel="noopener" target="_blank">First look: Central Element reveals Lavender Bay apartment plans</a>

Immediately around North Sy​dney Station, another two significant proposals have emerged at 5 and 15 Blue Street.

Zurich Australian Insurance Properties is seeking to adaptively reuse its longstanding commercial building at 5 Blue Street, directly above North Sydney Station, rather than demolishing the structure.

Its SSDA proposes converting the building into a 14-storey mixed-use development with 62 apartments and 86 co-living rooms, together with ground-floor retail and a major refurbishment of Blue Street Plaza. The application is currently at the Response to Submissions stage.

<a href="https://www.apartments.com.au/news/nsw/first-look-zurich-targets-north-sydney-office-conversion-with-148-unit-proposal-above-metro-station">First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station</a>

&nbsp;

First look: Vinnies files for 20-storey Lavender Bay apartment tower as North Sydney housing pocket heats up

When the opportunity arose for South Australian developer Palumbo to return to Kent Town, where it had previously delivered East Park Apartments and the East 
Rundle Apartments, it wasn't one the longstanding developer-builder was going to pass up.

The decision was quickly vindicated, with more than 30 apartments sold within the first month of launching <a href="https://www.apartments.com.au/new-apartments/royal-apartments-kent-town-2-8-north-terrace-kent-town-sa-5067">Royal Apartments</a> to the market.

The 206-apartment development, which will bring significant new supply to Adelaide's tightly held eastern city fringe, also gives <a href="https://www.apartments.com.au/developers/palumbo">Palumbo</a> the opportunity to bring new life to one of Kent Town's most recognisable watering holes.

[smartcode_project:default project_id=6109 project_image_fid=376073]

Royal Apartments incorporates the historic Royal Hotel, a venue Palumbo Managing Director Daniel Palumbo said has a longstanding connection with the local community.

"Everyone in the area has history with the Royal Hotel," Palumbo told Apartments.com.au.

"It was quite an active pub and social gathering place for locals. We want to bring it back to its former glory."

[smartcode_project:default project_id=6109 project_image_fid=376072]

The wider development will comprise two residential towers alongside the restored hotel, sitting on North Terrace opposite the Adelaide Park Lands.

For Palumbo, the project also marks a return to familiar territory.

The developer completed East Park Apartments next door more than a decade ago and jumped at the opportunity to develop in Kent Town again when the Royal Hotel site became available.

"The opportunity emerged, and we moved to secure the site," Palumbo said.

"We were approached by the previous landowner, who said they had extensive commitments in Sydney and weren't in a position to deliver the project.

"We took over the site and within six months recut the design scheme to be more in keeping with the type of development we want to bring to Adelaide.

"Now we're on the market and those changes have really resonated with local buyers."

That has translated into a strong start to sales, with 33 apartments transacting in the project's first 35 days.

Palumbo said the early purchaser profile had been consistent with the group's traditional focus on owner-occupiers rather than investor-led apartment stock.

"Local owner-occupiers have always been our market," he said.

"There are always some investors, but we've never developed what would be called traditional development stock. Owner-occupiers are very much our market."

[smartcode_project:default project_id=6109 project_image_fid=376068]

The buyer mix has been diverse so far, with downsizers and younger professionals both accounting for a significant portion of early sales.

South Australia's current stamp duty settings, which allow&nbsp;eligible homeowners in South Australia aged 60 savings of up to $103,830 on stamp duty when they downsize to a new property valued at up to $2 million,&nbsp;have helped encourage downsizer activity, while younger buyers in their late 20s and early 30s have been attracted to the opportunity to live immediately outside the CBD while still being able to walk into the city.



Location has been a major part of the proposition for both buyer cohorts.

[smartcode_project:default project_id=6109 project_image_fid=376075]

Royal Apartments sits on North Terrace directly opposite the Adelaide Park Lands, with residents able to walk through the parklands toward the East End, Rundle Street and Rundle Mall.

Apartments have been positioned to capture views across the parklands, Adelaide skyline, Botanic Gardens and Adelaide Hills.

Palumbo believes the scarcity of developable land along this section of the Park Lands makes the site particularly difficult to replicate.

"There's very few allotments on that side that can be developed," he said.

"If this location was in New York and you were sitting on Central Park, you'd be talking about a $60 million apartments."

Royal Apartments will offer a broad mix of residences, ranging from one-bedroom apartments through to four-bedroom sub-penthouses and penthouses.

Current listings include one-bedroom apartments from $680,000, while larger three and four-bedroom residences are priced around $2.5 million.

Residents will have access to a swimming pool, gym, barbecue and recreation areas, residents' lounge and dining space, and a communal deck.

[smartcode_project:default project_id=6109 project_image_fid=376067]

The apartments will feature generous balconies, while secure parking, bicycle storage and storage cages will also be provided.

A porte-cochère-style arrival and drop-off area has also resonated with buyers, particularly those attracted to being able to walk into the CBD during the day while retaining secure vehicle access at home.

Palumbo is acting as developer, architect and builder on Royal Apartments, continuing the vertically integrated model it has used across its South Australian portfolio.

The group was also behind the $150 million Sofitel Adelaide, the 251-room five-star hotel and residential tower which opened in 2021.

Palumbo said Royal's launch had come at an interesting time for the broader Adelaide apartment market.

Buyer confidence had initially been impacted by uncertainty surrounding the Federal Budget and broader economic conditions, but Palumbo believes sentiment is beginning to improve against a backdrop of significant investment flowing into South Australia.

He pointed to increased activity across defence and resources, including Olympic Dam, as potential long-term drivers of the state's economy and housing market.

"Money is starting to flow into Adeliade, significant amounts as Adelaide bucks the trend of the rest of the country.," Palumbo said.

"There's a lot of activity in the economy over the next decade. I think more investment will come into this market."

Early works on Royal Apartments are expected to commence this year, with major construction activity and cranes anticipated on site from early next year.

[smartcode_project_cta:default project_id=6109]

Palumbo's return to Kent Town strikes early chord with buyers

Go-to builder-developer <a href="https://www.apartments.com.au/developers/graya">GRAYA</a> is continuing to bulk out its already impressive and diverse apartment portfolio across South East Queensland. Their latest milestone is securing development approval for Silk, its boutique riverfront apartment development in St Lucia.

The approval clears&nbsp;the way for the team to begin construction planning for the 22-residence project.

<a href="https://www.apartments.com.au/new-apartments/silk-st-lucia-16-18-sandford-street-st-lucia-qld-4067">Silk</a> will rise 15 levels from an 810 sqm site at 16-18 Sandford Street, occupying a prominent bend of the Brisbane River with a prized northern aspect across Orleigh Park toward the Brisbane CBD.

The approved scheme will comprise 16 split-floor and six full-floor residences, continuing GRAYA's move into larger-format apartment developments targeting Brisbane's prestige owner-occupier market.

The project has been designed around the site's broad river frontage and dual-direction views, with GRAYA prioritising larger residences, privacy and outlook over apartment yield.

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="aa5c2349-f96c-4914-a812-1f2cd6827af8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.44%E2%80%AFAM.png?VersionId=WY0vEU_7vYjeRJKQHiCwFdMxu8PvFh52" />

GRAYA Co-founder and Chief Executive Officer Rob Gray said the project had been shaped around local homeowners wanting to remain in St Lucia without maintaining a traditional family home.

"St Lucia is one of those suburbs people do not want to leave," Gray said.

"They know the river, the trees, UQ, the golf course, Toowong and Indooroopilly, and that familiarity is hard to replace.

"True riverfront opportunities here are exceptionally scarce. What we have designed at Silk is a way to stay in the suburb people love, with the scale and privacy of a private home and far less to maintain.

"This is not typical apartment product. It is a proper home on the river, and that is exactly what this market has been missing."

The approval comes as new apartment development continues to increase across the St Lucia and neighbouring Toowong corridor, although direct riverfront sites remain considerably more tightly held.

GRAYA Co-founder and Managing Director Andrew Gray said securing the approval had removed a significant element of development risk from Silk.

"Genuine riverfront sites of this quality in St Lucia are not something that comes up regularly," Gray said.

"The approval removes a substantial layer of execution risk, and the location underwrites demand in a way very few inner-city sites can.

"The fundamentals here are as strong as anything we have assessed in Brisbane."

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="d0f3d734-65e1-48e8-8ed3-2e0715ffcdd9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.56%E2%80%AFAM.png?VersionId=sOLSs_jdHkXLWbBKzRyayf5BfTb2vPsD" />

Silk will see GRAYA return to a stretch of the Brisbane River where it already has recent construction experience. The vertically integrated group recently completed ARC in neighbouring Toowong as builder for developer Spyre, delivering the riverfront project on a constrained site.

GRAYA will take a different role at Silk, controlling the project from design and development through construction and aftercare under its vertically integrated model.

The development will include a gym and resident leisure areas at ground level, integrated with the river's edge.

Silk joins a growing pipeline for GRAYA across Brisbane and the Gold Coast, which includes Enclave, The Gallery, Coral and Ripple.

The developer-builder has also recently lodged plans for its largest project to date, <a href="https://www.apartments.com.au/new-apartments/the-silo-19-chester-street-newstead-qld-4006">The Silo</a>, a proposed <a href="https://www.apartments.com.au/news/qld/graya-buys-frasers-newstead-site-plans-the-silo-between-james-street-and-gasworks-precincts">$700 million mixed-use development</a> in Brisbane's James Street precinct.

Silk is expected to predominantly target local owner-occupiers and prestige buyers seeking a permanent riverfront home in Brisbane's inner west.

Registrations of interest are now open, with further details on the project and construction program to be released as it progresses.

<hr />
<h2>SILK PROJECT FACTS</h2>

Developer-builder: GRAYA

Project: Silk

Location: 16-18 Sandford Street, St Lucia

Apartments: 22

Built form: 15 levels

Site: 810 sqm riverfront holding

Mix: 16 split-floor and six full-floor residences

Status: Development approved

Next step: Construction planning underway

[smartcode_project_cta:default project_id=152168]

GRAYA greenlit for riverfront St Lucia apartment development, Silk

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There’s no doubt that depreciation can make a <a href="/guides/property-depreciation-continues-to-maximise-cash-flow">significant difference </a>to any investor’s cash flow, but how does it work? 

What is property depreciation?

As a property gets older, its structure and assets wear out – they depreciate. The Australian Taxation Office (ATO) permits owners of income-producing properties to claim this depreciation as a tax deduction.

What can be claimed?

Depreciation is claimed under two categories, capital works and plant and equipment. 

Capital works deductions are claimed on the building’s structure and any permanently fixed assets. Common assets that are claimed under capital works include driveways, walls, basins and roofs. 

Plant and equipment deductions are claimed on assets that are considered to be easily removable or mechanical in nature. Some common examples of plant and equipment assets include air-conditioning units, blinds, hot water systems and flooring. 

How is depreciation calculated? 

<a href="/guides/how-to-invest-in-property-in-2020-the-ultimate-guide">Property investors</a> can claim capital works deductions at a rate of 2.5 per cent for up to forty years. Capital works deductions generally make up an average of 85 to 90 per cent of a total depreciation claim. 

Depreciation for plant and equipment assets differs from depreciation of capital works. These assets are generally depreciated based on their effective life through the diminishing value or prime cost method. 

The diminishing value method is the most commonly used method of depreciation for plant and equipment assets. Under this method, depreciation deductions are calculated as a percentage of the asset’s depreciable balance. This results in higher deductions in the earlier years of ownership. 

Alternatively, the prime cost method calculates depreciation as a percentage of the cost. When the prime cost method is used, deductions are not as high in initial years but are spread out over time and produce a more even claim each financial year. 

Claiming depreciation with the low-value pool or immediate write-off

Depreciation deductions on plant and equipment assets can be claimed sooner through the low-value pool or as an immediate write-off. 

The low-value pool allows qualifying assets to be depreciated at an accelerated rate. Assets in the pool can be claimed at a rate of 18% in the first year, and 37.5% each following year. 

There are two different ways that an asset can qualify for a low-value pool:

<ul>
<li>
Low-cost asset: Is a depreciable asset with an opening value of less than $1,000. </li>
	<li>
Low-value asset: Is a depreciable asset that has a written down value of less than $1,000. This means the asset’s value was more than $1,000 in the year of acquisition but the residual value of depreciation is now less than $1,000.</li>
</ul>
The immediate write-off is also available for eligible low-cost assets. For individual residential investors, qualifying assets that cost $300 or less can be claimed as an immediate write-off. 

Depreciation and renovations 

Significant depreciation deductions can be claimed before and after a renovation has been completed on an <a href="/guides/looking-to-buy-an-investment-property-top-3-things-you-must-do-online-first">investment property</a>. 

A process called scrapping allows property owners to claim deductions for the un-deducted value of removed assets in the year they were removed. To take advantage of scrapping, a depreciation schedule must be arranged both before and after the renovation takes place. 

How does property tax depreciation boost cash flow?

Property depreciation is a non-cash deduction that essentially reduces a property owner’s taxable income. This means they pay less tax each financial year without paying for any additional costs. 

To claim depreciation, a tax depreciation schedule completed by a specialist quantity surveyor is essential.

Estimating depreciation deductions before buying an investment property

Owning an investment property is a balancing act of income and expenses. When deciding whether to <a href="/new-apartments">buy an investment property,</a> investors should consider obtaining a depreciation estimate of the property they are looking to buy. 
</body></html>

Investor’s Guide to Residential Property Depreciation 

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GUEST OBSERVATION
Oliver Wendell Holmes Jr famously observed in 1927 that “taxes are what we pay for civilised society, <a href="https://www.propertyobserver.com.au/http://www.worldlii.org/us/cases/federal/USSC/1927/178">including the chance to insure</a>”.
Whilst tax as a price for civilised society is well understood, less appreciated is the second part of his observation – that tax provides a chance to insure against a crisis.
As nations emerge from the COVID-19 crisis with policies unthinkable just six months ago, and associated debts previously unimaginable, it is becoming clear that while some were well insured and able to respond rapidly, most were underinsured, exposing their civilisations to previously unthinkable risks.
In many ways Australia is an exemplar in its use of taxation to provide the “chance to insure”. It funds Medicare; the Pharmaceuticals Benefit Scheme; the Higher Education Loan Program; the Superannuation Guarantee Charge and contingency-based welfare payments.
COVID has exposed the weakness in our system
COVID-19 has exposed how underinsured Australia is in other ways. It will have to borrow heavily to protect the economy, but for many years won’t be able to impose the extra taxes that will be needed to pay down the debt.
Introducing new taxes or increasing existing tax rates would threaten what will be a fragile recovery.
The only realistic option is to review what Australia gives away, such as <a href="https://treasury.gov.au/sites/default/files/2020-01/complete_tbvs_web.pdf">tax concessions,</a> and what it fails to collect, as measured by the so-called <a href="https://www.ato.gov.au/About-ATO/Research-and-statistics/In-detail/Tax-gap/Australian-tax-gaps-overview/">tax gap</a>.
The tax gap is the difference between the amount the Tax Office collects and what we would have collected if every taxpayer was fully compliant with tax law.
In 2016-17, the Commonwealth raised <a href="https://www.propertyobserver.com.au/https://www.abs.gov.au/ausstats/abs@.nsf/mf/5506.0">A$389 billion</a> in taxes, intentionally gave away an estimated <a href="https://treasury.gov.au/publication/p2019-357183">$166 billion</a> and unintentionally failed to collect a further <a href="https://www.ato.gov.au/About-ATO/Research-and-statistics/In-detail/Tax-gap/Australian-tax-gaps-overview/?anchor=Summaryfindings#Summaryfindings">$30-35 billion</a> that the Tax Office knows of.
Mapping out a pathway to winding back government debt and funding programs to better insure our civilised society has to begin with ensuring those who are not currently carrying their fair share of the legislated tax burden do so through reforms to reduce non-compliance.
Many of us aren’t paying the tax we should
The Tax Office conservatively estimates that non-compliance for the taxes it has so far examined is equivalent to more than <a href="https://www.ato.gov.au/About-ATO/Research-and-statistics/In-detail/Tax-gap/Australian-tax-gaps-overview/?anchor=Summaryfindings#Summaryfindings">8%</a> of the tax revenue it collected in 2015-16.
The Treasury also estimates that tax concessions in 2017-18 were equivalent to <a href="https://treasury.gov.au/sites/default/files/2020-01/complete_tbvs_web.pdf">41%</a> of Commonwealth government revenue, or more than 9% of GDP (although it cautions against adding estimates together as reducing one concession can affect the use of others).
Given the scale of the Commonwealth response to COVID-19, the government will need additional tax revenues of around 2.5% of GDP (about $50 billion) for some years.
This should not prove insurmountable. In comparison with other advanced economies, Australia is a relative low taxer with a total tax burden of 28.6% of GDP in 2017-18, well below the OECD average of about 34.5%.
There’s revenue going begging
The tax gap estimates show billions can be raised from integrity measures such as addressing overclaimed work-related expenses ($3 billion), unreported cash wages ($1 billion) unreported rental property net income ($2 billion) and unreported business income ($2-3 billion).
There’s much more available from reducing tax concessions, removing the personal tax-free threshold, winding back retirement savings concessions, and broadening the goods and service tax (especially from fully taxing the food that is already partially taxed).
Lower income groups affected by the changes should be compensated by improved targeting of expenditure programs.
Right now we’ve a near-universal welfare system and a targeted tax system.
The way out of our present problems is to make the tax system more universal and the welfare system more targeted.
New taxes and higher rates should be resisted, especially if made more palatable by more concessions.
What we are proposing would not only result in a tax system that was simpler and harder to escape – but one that was capable of funding the insurance we will need to preserve our society into the future
There’s no reason to think there won’t be another pandemic exposing the weaknesses in our tax system that remain.<img src="https://counter.theconversation.com/content/137232/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/neil-warren-278638">Neil Warren</a>, Emeritus Professor of Taxation, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a> and <a href="https://theconversation.com/profiles/richard-highfield-1049892">Richard Highfield</a>, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>
This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/post-coronavirus-well-need-a-working-tax-system-not-more-taxes-and-not-higher-rates-137232">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Post-coronavirus, we'll need a working tax system, not more taxes and higher rates

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GUEST OBSERVATION
Discussions about Australia’s retirement income system typically begin by reciting the political slogan that there are “three pillars” to the system — the age pension, compulsory super, and voluntary savings.
It was the way the Abbott and Turnbull government’s <a href="https://slideplayer.com/slide/4872297/" target="_blank">tax inquiry</a> looked at retirement incomes, and a frame of reference used by this government’s <a href="https://treasury.gov.au/sites/default/files/2019-11/c2019-36292-v2.pdf" target="_blank">retirement income system review</a>.
Missing is discussion of what makes something a “retirement pillar”.
<a href="https://images.theconversation.com/files/313028/original/file-20200131-41495-b580y4.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip" target="_blank"><img src="https://images.theconversation.com/files/313028/original/file-20200131-41495-b580y4.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
<a class="source" href="https://slideplayer.com/slide/4872297/" target="_blank">Treasury tax white paper slideshow, 2015</a>
It’s possible to think of other retirement pillars. Moving to India for a cheap lifestyle would be one.
Requiring retailers to <a href="https://www.fresheconomicthinking.com/2020/01/the-easiest-retirement-system-retiree" target="_blank">provide the elderly free goods and services</a>, with the cost absorbed in the prices paid by others could be another.
To be a pillar, something would have to allocate goods and services in retirement to people who are no longer earning wages.
In my <a href="https://www.fresheconomicthinking.com/p/scrap-superannuation" target="_blank">recently released report</a> I argue that superannuation fails this test.
Super isn’t a retirement pillar
Among other things, super can be spent many years before retirement, beginning anywhere from age <a href="https://www.ato.gov.au/Super/Self-managed-super-funds/Paying-benefits/Preservation-of-super/" target="_blank">55 to 60</a>, even though the retirement age specified the pension legislation is <a href="https://www.humanservices.gov.au/individuals/services/centrelink/age-pension/who-can-get-it" target="_blank">66 to 67</a>.
Many financial planners advise intending retirees to spend a lot of their super quickly in order to shelter it in income-test-exempt assets <a href="https://www.yourlifechoices.com.au/finance/property/how-upsizing-protects-your-pension" target="_blank">such as housing</a> and qualify for the pension.
The super system also can’t guarantee retirement incomes for people who are self-employed, casually employed, homemakers, have chosen their super fund unwisely or lost the proceeds in things such as online romance scams.
As a system, super comes with unnecessary financial risks, such as suddenly losing 21% of its funds, as happened between September 2007 and March 2009 during the global financial crisis.
It is better thought of as a growth-sapping, resource-wasting, tax-advantaged asset purchase scheme aimed at the already wealthy, which is <a href="https://theconversation.com/myth-busted-boosting-super-would-cost-the-budget-more-than-it-saved-on-age-pensions-119002" target="_blank">unlikely to do much</a> to reduce reliance on the age pension.
We would be better off abandoning it and letting workers spend or save their money as they see fit.
The super system is inefficient
The superannuation system employs <a href="https://www.ibisworld.com.au/industry-trends/market-research-reports/financial-insurance-services/superannuation-funds" target="_blank">55,000 people</a> at a cost of <a href="https://www.selectingsuper.com.au/superannuation-fees-fall-for-the-first-time-in-six-years" target="_blank">A$32 billion</a> per year to produce <a href="https://www.apra.gov.au/quarterly-superannuation-statistics" target="_blank">$40 billion</a> per year in retirement incomes. This is nearly as many people as the enlisted Australian Defence Force (58,000) with a similar total cost ($34 billion).
The rest of Australia’s entire welfare system, including administering the age pension, disability, unemployment benefits and Medicare, costs just $6 billion per year and employs <a href="https://www.servicesaustralia.gov.au/sites/default/files/2018/10/8802-1810-annual-report-web-2017-2018.pdf" target="_blank">33,000 people</a>, while providing <a href="https://www.servicesaustralia.gov.au/sites/default/files/2018/10/8802-1810-annual-report-web-2017-2018.pdf">$45 billion</a> in pension benefits.
It directs money where it isn’t needed...
Each year the superannuation system takes in <a href="https://www.apra.gov.au/quarterly-superannuation-statistics" target="_blank">$117 billion</a> and spits out <a href="https://www.apra.gov.au/sites/default/files/Quarterly%20Superannuation%20Performance%20Statistics%20September%202019_0.pdf" target="_blank">$80 billion</a> in payments (including lump sum withdrawals), leaving $38 billion in asset markets, sapping spending and economic growth. That’s roughly as much as the <a href="https://www.smh.com.au/business/saving-the-nation-20090203-7wsb" target="_blank">$40 billion</a> stimulus package introduced during the 2009 financial crisis. Unlike it, the super system depresses rather than stimulates the economy.
Unlike the super system, the age pension system is likely to stimulate the economy because it takes purchasing power away from high-income taxpayers with a relatively low likelihood of spending extra dollars to to lower-income pensioners with a high likelihood of spending them.
…and away from those who do need it
Unlike the age pension system, the super system can’t provide poverty relief, or broadly adequate retirement incomes.
For the bottom 40% of earners it does the opposite of smoothing income, making them poorer than they would have been while working, and somewhat <a href="https://theconversation.com/super-shock-more-compulsory-super-would-make-middle-australia-poorer-not-richer-120002">richer</a> than they would have been while on the pension and retired.
The <a href="https://treasury.gov.au/publication/p2020-51153" target="_blank">$18 billion</a> of tax breaks on super fund contributions and <a href="https://treasury.gov.au/publication/p2020-51153" target="_blank">$20 billion</a> of tax breaks on super fund earnings are predominately directed to <a href="https://treasury.gov.au/programs-and-initiatives-superannuation/distributional-analysis-of-superannuation-taxation-concessions" target="_blank">high income earners</a>.
In a comprehensive study released this week the Grattan Institute has demolished the claim that super contributions come out of employers pockets. Instead it finds that, on average, <a href="https://grattan.edu.au/report/no-free-lunch/" target="_blank">80%</a> of each super contribution comes out of what would have been wages.
Here’s how to escape it
Scrapping the system altogether would massively improve Australia’s economic performance, including the performance of our only true retirement income system, which is the age pension.
It can be done by forcing employers to pay what are now super contributions directly into wage accounts and allowing super fund holders to withdraw up to a maximum amount each year during a transition period, after which all super balances would receive no special tax treatment.
The tens of billions saved in the budget could be used to enhance the size and scope of the age pension. It could incorporate <a href="https://theconversation.com/fall-in-ageing-australians-home-ownership-rates-looms-as-seismic-shock-for-housing-policy-120651" target="_blank">appropriate rent assistance</a> and begin at age 60 instead of 67.
It’s possible. Certainly, there would be job losses, but in other industries we have come to accept that there is no point in continuing to pay people to do things that aren’t needed, and especially no point in making those payments compulsory.
It’d be one of the best things we could do to enhance the working of our economy.<img src="https://counter.theconversation.com/content/130191/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/cameron-murray-172480" target="_blank">Cameron Murray</a>, Research Fellow - Henry Halloran Trust, <a href="https://theconversation.com/institutions/university-of-sydney-841" target="_blank">University of Sydney</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/superannuation-isnt-a-retirement-income-system-we-should-scrap-it-130191" target="_blank">original article</a>.
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Superannuation isn't a retirement income system, we should scrap it: Cameron Murray

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The exiled Chinese billionaire Huang Xiangmo has accused the Australian Tax Office of being a "political weapon" that was surrendering to "unknown dark forces".
He said the Tax Office had been "reduced to a despicable tool of political persecution".
He questioned whether "Australian politicians and media outlets who bank on telling tales about China and the Chinese [are] any different from the White Supremacists or the McCarthyites".
The property developer is fighting a $140 million tax bill by resisting a court order to disclose his worldwide assets which the ATO seeks to freeze.
The Tax Office is seeking to bankrupt the Chinese billionaire.
The <a href="https://www.huangxiangmo.com/" target="_blank" data-track-relatedarticle="inarticlelink">statement</a> was published on his personal website.
Huang, a central figure in the ICAC's ongoing inquiry into the alleged Aldi plastic bag NSW Labor donations, has resided in Hong Kong since his Australian permanent residency visa was cancelled last December.
"Before my visa was unfairly revoked by ASIO, [the] ATO had not once brought up the large amount of tax payable as alleged in the case," Huang said.
"By taking advantage of its tax collection power for the purpose of political character assassination and persecution, the ATO has turned into a 'political weapon'."
Huang said accusations of him of being a Chinese "agent of influence" came without "even a hair of evidence for such allegation".
The bulk of the tax bill was attributed to the sale of a mansion in Hong Kong, which was said to give rise to a capital gains tax liability.
On Monday, the Federal Court continued the freezing order.
It ordered Mr Huang to disclose his worldwide assets within 21 days.
The ICAC is investigating allegations Huang made a $100,000 cash donation to the NSW Labor Party in 2015.
Huang was banned from making political donations in NSW under laws targeting property developers.
He has declined to give evidence by video to the ICAC but denied making the donation.
Huang said he had an "impeccable" tax record in Australia and had "never ... had any history of default anywhere, let alone any record of tax evasion".
Earlier this year two Australian Chinese-language papers devoted their front pages to an open letter backing exiled billionaire property developer after his permanent residency was cancelled for reasons including character grounds in early February.
It says the Morrison government's decision to cancel Huang's residency was outrageous and calls for it to be overturned.
The letter appears to be a paid ad.
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Exiled billionaire Huang Xiangmo brands Australian Tax Office a 'despicable tool of political persecution'

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GUEST OBSERVATION 
Inheritances can have an enormous impact on finances and lives.
Yet in Australia we know surprisingly little about who gets them and how big they are.
New <a href="https://grattan.edu.au/report/generation-gap/" target="_blank">Grattan Institute research</a> provides some answers.
Inheritances are big and growing
A sample of estates from Victoria’s probate office suggests the median estate in Victoria is worth around A$500,000. That’s likely to be close to what it is Australia-wide.
But many are much larger. About 20% are worth more than A$1 million, and 7% are more than A$2 million. Property is the largest component, accounting for about half of the average value.
The main beneficiaries of “final” estates (estates without a surviving spouse) are children, who receive about three-quarters of all inheritance money.
Other family members, such as nieces, nephews and grandchildren, receive about 20%. Friends get about 4%, and charities 2%.
Average inheritances are growing about two percentage points faster than inflation each year, which is a good deal faster than wages or gross domestic product.
There are reasons to believe they will soon grow even faster.
Net wealth has grown strongly among older households. Households headed by people aged over 75 now have an average of A$1 million in assets, up from A$400,000 for a household headed by a person of the same age in 1994.
And most retirees <a href="https://grattan.edu.au/report/money-in-retirement/" target="_blank">don’t draw down</a> on their savings.
Indeed, many are net savers through much of their retirement, meaning there’s only one place their accumulated property and superannuation wealth can go: into bequests.
Inheritances are going to the already old…
These days, inheritances generally don’t arrive when people are saving for a house or trying to raise a young family.
More than 80% of money passed down from parents goes to people aged 50 and over.
The most common age bracket in which people to receive an inheritance from parents is 55-59.
<a href="https://www.propertyobserver.com.au/images/2019/8/20/INHERTANCE%201.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/8/20/INHERTANCE%201.png" alt="">
It’s the result of good news – parents are living longer.
But as life expectancy grows still further, it will mean inheritances increasingly supplement the retirement savings of middle-aged Australians rather than help young people get into housing.
…and the already wealthy
The wealthiest 20% of Australians get 38% of inheritance money; the poorest 20% get only 8%.
It means the growing wealth of Baby Boomers is likely to end up concentrated in the hands of a select group relatively well-off Generation Xers and Millennials rather than being widely spread.
<a href="https://www.propertyobserver.com.au/images/2019/8/20/INHERITANCE%202.png" target="_blank">Click here</a> to enlarge: 
<img src="https://www.urban.com.au/images/2019/8/20/INHERITANCE%202.png" alt="">
It will reinforce the advantages already enjoyed by people with well-off parents, including better schooling, better connections, and a greater ability to take financial risks because of a parental safety net.
If (as is possible) inheritances end up becoming the dominant route to wealth in Australia surpassing lifetime earnings, there will be less incentive for ordinary Australians to attempt to get ahead through individual endeavour.
We will have entered what French economist Thomas Piketty calls a “<a href="https://www.pbs.org/newshour/nation/how-pikettys-inequality-theory-explains-mr-darcys-wealth" target="_blank">Jane Austen world</a>”.
We don’t tax inheritances…
Calm debate on policy setting around inheritances is <a href="https://insidestory.org.au/death-and-taxes/" target="_blank">hard to come by</a> in Australia.
Inheritances and gifts have been tax-free since the 1970s.
Australia is one of only <a href="https://stats.oecd.org/index.aspx?DataSetCode=REV" target="_blank">seven</a> OECD countries without any inheritance, estate, or gift taxes. Despite the economic arguments for inheritance taxes, there seems to be little appetite to bring them back.
…if anything, we subsidise them
Not taxing inheritances is one thing, but actively subsidising them is another.
Superannuation tax breaks were intended to encourage people to save for their retirement and to take pressure off the age pension system.
But given that many retired Australians <a href="https://grattan.edu.au/report/money-in-retirement/" target="_blank">do not draw down on their capital</a>, a large part of the super tax concessions simply boosts the size of bequests.
Super death benefits tax is intended to claw back the superannuation tax breaks when the money is passed on, in order to ensure that the government doesn’t subsidise inheritances.
But, at 15%, the rate is too low to capture the value of the accumulated tax breaks. And it can easily be avoided by retirees withdrawing funds tax-free and then contributing them back as a post-tax contribution, which is tax-free when passed on.
The special treatment of the family home in the age pension means test also acts to boost inheritances at taxpayers’ expense. Without it there would less to pass on.
It’s time to claw some of them back
There is little justification for taxpayers subsidising inheritances. Policy changes could help.
We recommend a higher tax on super bequests paid to non-dependents to better capture the value of the super tax breaks that are passed on rather than used for retirement. The cap on post-tax super contributions should also be lowered, to limit the re-contribution strategies.
The age pension assets test should include part of the value of the family home, perhaps the part above A$500,000. Seniors with higher-value properties should be allowed to borrow against their home using the Pension Loans Scheme.
This would give them the ability to stay in their home but would mean that some of the wealth that would otherwise be passed to heirs (most likely in their 50s) would instead be used to fund them, taking pressure off the pension.
Owain Emslie, Associate, Grattan Institute 
Danielle Wood, Program Director, Budget Policy and Institutional Reform, Grattan Institute.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/rethink-inheritances-these-days-they-no-longer-help-the-young-they-go-to-the-already-middle-aged-122029" target="_blank">original article</a>.
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Rethink inheritances. These days they no longer help the young, they go to the already middle-aged

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Retailers faced yet another period of weak demand and declining retail spending over the March quarter of 2019, according to Deloitte Access Economics’ latest quarterly Retail Forecasts report.
The report found however, it may not be all doom and gloom for the sector, with some relief expected in the second half of the year in the form of increased tax offsets.
Real retail turnover growth is expected to slow from 2.2% in 2018 to just 1.5% in 2019, before picking up in 2020 to 2.9%
Household finances have come under pressure from stagnant wage growth and declining wealth, despite decreased unemployment numbers.
This has hurt consumer sentiment and weighed on willingness to spend.
<img src="https://www.urban.com.au/images/2019/6/14/Deloitte.JPG" alt="">
Deloitte Access Economics partner and Retail Forecasts principal author, David Rumbens, said, “March quarter retail data confirmed our view that consumers are just not willing to spend as they once were. People are pulling back on spending as household finances remain under pressure from stagnant wage growth and declining wealth.
“A deteriorating labour market, inflation below the target range, weak consumption, and falling house prices were enough to prompt monetary easing by the Reserve Bank of Australia for the first time in nearly three years, and lower rates will leave some much needed cash in the pockets of Australia’s highly indebted households."
He added that over half of all tax refunds are completed in the September quarter, and just under another 25% in December.
“This bodes well for a surge in spending in the September quarter, rising around 1.3% over the quarter, and provide the boost retailers have been craving,” Rumbens concluded.
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Post election tax offsets may boost hurting retailers: Deloitte

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EXPERT OBSERVATION
The Customer Owned Banking Association (COBA) has strongly criticised a Treasury proposal to hike levies on smaller banks while cutting levies for the four major banks.
Treasury is proposing dramatic increases in levies on customer owned banks and smaller listed banks while gifting the big four a $3 million levy reduction (see Treasury table below).
The levies are intended to cover higher regulatory costs for the banking regulator APRA flowing from the Financial Services Royal Commission.
Smaller banks’ levies are sharply ratcheted upwards by more than 25% while major bank levies are reduced.
This makes no sense at all given it was the misconduct of the major banks that has prompted the need to increase resourcing for APRA.
Customer owned banking institutions have not engaged in the misconduct examined by the Royal Commission but now face being forced to ‘pay the price’.
These proposals send a very confusing signal about the Government’s intention to hold the major banks accountable for their conduct.
Major banks already have a head start on their smaller competitors through various aspects of the regulatory framework.
They don’t deserve the extra help of a cut in their APRA levies while their much smaller competitors are hit with huge increases.
Click <a href="https://www.propertyobserver.com.au/images/2019/6/6/ADI%20Levies.JPG" target="_blank">here</a> to enlarge
<img src="https://www.urban.com.au/images/2019/6/6/ADI%20Levies.JPG" alt="">
I urge the Treasurer to intervene and rule out these grossly unfair increases in APRA levies on COBA member banking institutions.
Regulator industry levies should be set with sensitivity to the cost burden on smaller banking institutions and with more weighting given to the systemic importance and market power of major banks.
The Productivity Commission describes the banking market as ‘an established oligopoly where the four major banks hold substantial market power and this is substantially supported by regulatory settings which contribute to the major banks’ structural advantages.
Sharply increasing levies paid by smaller banking institutions while reducing levies paid by major banks will make a bad situation worse.
MICHAEL LAWRENCE is the CEO of the Customer Owned Banking Association. 
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Unfair tax hike proposed for smaller banks: COBA's Michael Lawrence

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EXPERT OBSERVATION 
In the lead up to the NSW election, the NSW residential building industry is being strangled in red tape and taxes.
Some 43% of the cost of a new house and land package is made up of taxes, charges and levies from all three tiers of Government.
Despite this, policies implemented by the State government continue to add to the tax burden for the housing industry.
By way of example, in the past 18 months, the following regulations and taxes have been implemented or proposed, each one having a negative impact on housing affordability and supply.
<ul>
<li>Removing caps on section 94 development contributions adding $20,000 – $40,000 per dwelling; 
</li>
<li>Increasing the BASIX energy efficiency targets adding an average of $10,000 per new dwelling; 
</li>
<li>Delaying the start of the medium density housing code to deal with Sydney’s “missing middle” for terrace and low rise medium density housing projects reacting to unreasonable and simple incorrect claims that the code would promote high-density housing after promoting the savings of around $15,000 in approval costs for these type of dwellings from the implementation of the code; 
</li>
<li>Introducing a 2% defect bond and an additional double barrel inspection regime for strata developments that will be ineffectual and add to the cost of all new strata projects and 
</li>
<li>Proposing a Greater Macarthur state infrastructure contribution (SIC) of $40,000 per dwelling, along with new SIC levies in the Hunter.</li>
</ul>
These changes can easily account for an additional $70-$90,000 per dwelling and once applied, they may be subject to stamp duty.
There are many things our state politicians can consider to help housing supply and affordability that don’t require drastic structural change.
For instance, the NSW Productivity Commissioner should be directed to undertake a detailed review of the regulatory burden and costs to the residential sector with the aim of reducing red tape, increasing productivity and thus improving housing affordability.
All new legislation and regulation impacting the housing sector should be subject to a thorough public regulatory impact assessment.
Adding to the problem of housing affordability and rental affordability with new red tape and taxes is not the solution to ensuring people in NSW can afford to buy or rent a home. More needs to be done now, politicians need to get serious and focus on real changes that will make a real difference to the cost of new homes in NSW.
David Bare is HIA Executive Director NSW.
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Taxes in NSW strangling future housing: HIA'S David Bare

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GUEST OBSERVATION
Do you live overseas and own a house in Australia? If so, you may have less than five months to act before you’re stuck with a large tax bill on the sale of that property.
<h3>Proposed tax changes</h3>
In May 2017, the Australian Government proposed changes to the existing capital gains tax (‘CGT’) laws. These changes will affect tax non-residents who hold property in Australia that have previously lived in as their main residence.
Under the current laws, an Australian property that is your main residence can be sold with potentially no Australian tax to pay (or at least a significantly reduced amount of tax to pay to reflect the ‘main residence’ period you lived there). However, under the proposed changes, if you are a non-resident (for Australian tax purposes) at the date of sale, you will no longer be able to claim the ‘main residence exemption’. This means that the entire gain you make on selling the property could be subject to tax, with no reduction for the period you actually lived in the property.
Although these proposed changes were announced nearly two years ago, they are still not law. It appears that one of the reasons for this is because the changes are quite draconian given non-residents could be taxed on the entire gain made on the property sale (irrespective of whether the property was their main residence for a significant period of time).
Further, if legislated, the changes are proposed to apply retrospectively from 9 May 2017. Despite this, there is a proposed transitional period for properties purchased before 9 May 2017 and sold by 30 June 2019 (whereby the current rules will still apply, meaning they could potentially still obtain the ‘main residence exemption’).
For many people, this means they may have less than five months to decide whether to sell their property or be faced with a large tax bill.
<h3>What should you do between now and 30 June 2019?</h3>
The uncertainty surrounding whether these changes will become law can make accurate decision making very difficult.
Should you sell your property now? Is it the right time to sell? What happens if the changes don’t become law?
Whilst the answers to many of the questions is outside your control, if you answer these four questions below, the decision-making process should become a lot clearer.
<ul>
<li>1) Will I actually be affected?</li>
</ul>
Ask yourself “will these changes even affect me?”
These changes will only apply where you are a tax non-resident at the date of sale. If you intend to re-establish your tax residency in Australia, the changes may not apply to you.
For example, you may currently be overseas on secondment and intend to return to Australia in the future. If you don’t plan on selling your property before returning to Australia, then you should not be affected by the changes.
Alternatively, if you plan to move overseas permanently and sell your property whilst you are a tax non-resident, then you would be affected and may need to act fast.
<ul>
<li>2) Will I have a large tax bill?</li>
</ul>
Even if you are affected by the proposed changes, you may not have a large tax bill on your hands.
To determine this, calculate what your tax liability would be (if any) under the current law and then again applying the proposed changes. If these calculations do not give rise to a material tax difference, you mightn’t have anything to worry about with the proposed changes.
For example, if you bought your house two years ago there may have been little growth in the value of the property since that time, meaning there may be little tax to pay on sale.
Alternatively, if you bought your house 30 years ago and lived there for 25 years prior to moving overseas, you could be up for a large tax bill on the difference in the property’s value between when you acquired it and when you sold it. In these circumstances, the decision to sell your property before 30 June 2019 becomes more relevant.
<ul>
<li>3) Should I sell before 30 June?</li>
</ul>
As an investor, you should assess whether it is appropriate for you to sell your property before 30 June 2019. This decision should not be made hastily (especially in light of Australia’s current property market).
According to CoreLogic, Australia is currently facing its weakest property market since 2008. As a result, if you were to sell your property during the coming months, you may not achieve the sale price you’re after. Are you better off holding the property long term and selling it when the market recovers? In some instances, a lower sale price may even outweigh any tax saving you would make by selling before 30 June 2019.
However, if you don’t sell your property, consider any potential holding costs. These could include land tax and an annual vacancy fee if your property is not residentially occupied or rented out for more than 183 days in a year.
Also ask yourself “how does my property fit within my investment portfolio?”. If your property has a strong rental yield you mightn’t be in a rush to sell. On the flip side, would the sale of your property enable you to invest in other assets with a higher return?
<ul>
<li>4) Will I be able to sell before 30 June?</li>
</ul>
Even if you decide to sell before 30 June, is it possible?
The Australian property market has experienced a recent decrease in auction clearance rates to 43.6% in the last quarter of 20181. These market conditions could cause delays in the sale of your property and mean you can’t actually sell before 30 June 2019.
If you need to undertake renovations to spruce your property up before selling, this could contribute to additional delays. This means you may need to move fast if you want to sell before 30 June.
<h3>Conclusion</h3>
Although the potential changes may seem daunting, if you work through the 4 steps above, you may find out you’ve got nothing to worry about. Alternatively, if you do have a potentially large tax problem, by acting fast and tailoring a solution to your personal circumstances, you may be able to manage (or eliminate) the problem.
NICOLE JOANNOU is a consultant for William Buck, a firm of Chartered Accountants and advisors with offices across Australia and New Zealand. 
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Sell your Australian property now, or risk a big tax bill: Nicole Joannou

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Savers for their first home have under a fortnight to start their savings and tax advantage during the current financial year under the recently introduced First Home Super Saver (FHSS) scheme.
FHBs have been advised in the countdown to the June 30 end of the tax year, there are advantages to start putting money in this financial year.
The FHSS scheme is based around making contributions to your superannuation fund to save for your deposit.
 Contributions to superannuation are taxed at 15%, which is typically lower than your marginal tax rate, meaning more of your cash is saved and less is going to the ATO. There is a limit of $15,000 per tax year.
The FHSS was introduced by the Australian Government in the Federal Budget 2017/18 to reduce the pressure on housing affordability.
It allows FHBs to save money for your first home inside your superannuation fund.
The idea was to help first home buyers save faster with the concessional tax treatment within super.
From 1 July 2017 you can make voluntary concessional (before-tax) and non-concessional (after-tax) contributions into your super fund to save for your first home.
From 1 July 2018 you can then apply to release your voluntary contributions, along with associated earnings, to help you purchase your first home.
This scheme is suitable for first home buyers if:
<ul>
<li>you either live or intend to live in the premises you are buying as soon as practicable</li>
<li>you intend to live in the property for at least six months of the first 12 months you own it, after it is practical to move in.</li>
</ul>
You can apply to have a maximum of $15,000 of your voluntary contributions from any one financial year included in your eligible contributions to be released under the FHSS scheme, up to a total of $30,000 contributions across all years.
You will also receive an amount of earnings that relate to those contributions.
For more information <a href="https://www.ato.gov.au/Individuals/Super/Super-housing-measures/First-Home-Super-Saver-Scheme/" target="_blank">click here.</a>
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