Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

[smartcode_project:default project_id=150489 project_image_fid=373834]

Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

[smartcode_project:default project_id=150713 project_image_fid=373827]

Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Joel Robinson

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

[smartcode_project:default project_id=151449 project_image_fid=357458]

Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

[smartcode_project_cta:default project_id=151449]

Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

[smartcode_project:default project_id=134951 project_image_fid=364551]

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

La Vera closes in on completion as Macquarie Park continues residential transformation

Brisbane developer Red &amp; Co's decision to include dual key apartments in its debut Gold Coast apartment development, <a href="https://www.apartments.com.au/new-apartments/como-varsity-lakes-22-lake-street-varsity-lakes-qld-4227">COMO Varsity Lakes</a>, is proving to be one of the project's biggest drawcards, with buyers quickly snapping up the flexible residences.

More than half of the project's 36 dual key apartments have already sold, helping drive COMO beyond the 50 per cent sold mark within the first month of launch.

The strong response highlights growing demand for apartment designs that can adapt to changing lifestyles, with buyers increasingly looking for homes that accommodate multi-generational living, provide rental income opportunities or simply offer greater flexibility over time.

Located on the shores of Lake Orr, COMO will deliver 156 apartments across 16 levels, with the dual-key residences forming a limited release within the broader development.

Each combines a primary two-bedroom apartment with a fully self-contained studio on a single title, connected by a shared foyer and lockable internal door. The design allows owners to house ageing parents, adult children or guests while maintaining privacy, or lease the secondary residence to generate additional income.

Just 17 of the original 36 dual key apartments remain available.

[smartcode_project:default project_id=135546 project_image_fid=367096]

The innovative configuration combines two fully self-contained residences on a single title, typically comprising a primary two-bedroom apartment alongside a separate studio residence, connected via a shared foyer and lockable internal door.&nbsp;

The model is proving particularly attractive to owner occupiers navigating changing family dynamics and the realities of the current housing crisis.&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363511]

<a href="https://www.apartments.com.au/project-marketer/npa">NPA</a>&nbsp;CEO Andrew Erwin said dual key living was resonating strongly with modern buyers because it delivered both financial flexibility and practical lifestyle benefits.&nbsp;

“The housing crisis and rising cost of living are fundamentally changing how Australians think about home ownership,” Erwin said.&nbsp;

“Dual key apartments provide a genuine solution for families who want to stay connected while maintaining independence. Parents can help adult children save for a future home, ageing parents can remain nearby without moving into aged care, and owners still retain privacy and flexibility.

“Importantly, buyers are also recognising the financial advantages. It creates the opportunity to generate additional income from part of the home without the holding costs associated with owning a separate investment property.”&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363509]

Unlike traditional dual occupancy arrangements, the residences operate under a single title, meaning owners only incur one set of body corporate fees, council rates and holding costs.&nbsp;

The secondary residence can also evolve over time - functioning as guest accommodation, a home office, creative studio or private retreat before later becoming an income-producing asset.

<a href="https://www.apartments.com.au/developers/red-co">Red &amp; Co</a>&nbsp;Director and Co-Founder David Laverty said the strong early sales reflected growing buyer urgency and changing priorities within the market.&nbsp;

“Securing more than half of COMO’s residences within such a short timeframe is an outstanding result and a clear endorsement of both the design and location,” Laverty said.&nbsp;

“Buyers are responding to the combination of location, connectivity and amenity, but ultimately it’s value relative to other East Coast markets that is driving enquiry.”&nbsp;

“We’re also seeing strong interest from owner occupiers looking for homes that can adapt with them over time. Flexibility has become one of the most important considerations for buyers in today’s market.”&nbsp;

[smartcode_project:default project_id=135546 project_image_fid=363515]

Designed by <a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a>, COMO features a mix of one-, two- and three-bedroom residences with 2.7-metre ceilings and larger-format floorplans aimed at owner occupiers, downsizers and lifestyle-focused buyers.&nbsp;

The development will feature an extensive rooftop recreation and wellness offering including a 25-metre lap pool, sundeck, barbecue and dining areas, gym, sauna, plunge baths, landscaped gardens, wellness spaces and rooftop pickleball and paddleball courts.

The remaining dual key apartments range from 137 sqm to 167 sqm and include generous three-bedroom layouts with separate self-contained studio accommodation and dual parking.&nbsp;

Erwin said the dual key concept represented a broader shift in how Australians would live in the future.

“People want homes that can evolve with their lives,” he said.&nbsp;

“A dual key apartment can suit a family today, support an ageing parent tomorrow, and potentially generate income later on. That adaptability is becoming incredibly valuable in the current environment.”

Prices currently range from $2,115,750 to $2,583,000.&nbsp;

[smartcode_project_cta:default project_id=135546]

Inter-generational living drives demand for COMO’s dual key apartments as housing pressures reshape buyer priorities 

Builder-developer&nbsp;<a href="https://www.apartments.com.au/developers/ceerose">Ceerose</a> has doubled down on its Leichhardt ambitions, lodging its second State Significant Development Application (SSDA) in the suburb in the last six months.

Their newest proposal seeks to transform a former industrial precinct into a new residential community centred around the adaptive reuse of one of the site's heritage warehouse buildings.

The new project, on a 6,930 sqm block at&nbsp;<a href="https://www.apartments.com.au/new-apartments/40-76-william-street-leichhardt-nsw-2040">40–76 William Street</a>, will bring more than 200 apartments to a suburb that has seen little to no new supply in recent years. It follows Ceerose's late 2025 SSDA for a mixed-use apartment project on nearby Parramatta Road, signalling the developer's growing investment in Sydney's Inner West.

Ceerose Founder Edward Doueihi told Apartments.com.au the developer’s long-standing presence in Leichhardt and the Inner West had given it a strong understanding of how the area has evolved and where its future opportunities lie.

“Ceerose has had a long-standing presence in Leichhardt and the Inner West, giving us a unique understanding of the area’s evolution and future potential,” Doueihi said.

“Having delivered projects throughout the region, we have witnessed the suburb’s transformation first-hand and understand the opportunities for its continued growth.”

Doueihi said that understanding also informed the planning process, with a comprehensive Stakeholder Engagement Outcomes Report prepared before the application was lodged.

The report identified the key issues and concerns raised by neighbouring residents and other stakeholders, allowing those matters to be considered and incorporated into the design where appropriate.

He said the delivery of additional housing would also play an important role in supporting the revitalisation of Norton Street and the Italian Forum.

“By increasing the local residential population, the development is expected to strengthen demand for local businesses, encourage further investment, and help restore the vibrancy that made the precinct a thriving destination in the early 2000s.”

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="7258c54c-8167-479e-8361-2d5fca9915b4" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010B%20-%20CGI%20-%20View%202.jpg?VersionId=S9DQfxu_jpcB5LrAEYFUbyMzg5odW6i5" />

Designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a>, the redevelopment would involve the demolition of four existing industrial buildings while retaining and adaptively reusing the site's most significant warehouse. The retained structure would anchor a new residential precinct comprising five interconnected buildings arranged around a large central landscaped courtyard, with heights stepping from five storeys along the surrounding residential streets to 11 storeys at the William Street corner.

According to the Architecture Design Report by Woods Bagot, the proposal "seeks to create a residential village centred around a generous green heart while celebrating the site's industrial heritage through the adaptive reuse of the existing warehouse building."

The development would comprise 203 apartments, with 188 proposed as build-to-sell residences, alongside 15 affordable housing apartments.

Rather than treating the retained warehouse as a standalone heritage object, Woods Bagot has sought to weave the site's industrial history throughout the masterplan. The proposal retains the north and west facades of the landmark corner warehouse, while new buildings reinterpret the site's brick-and-steel industrial language through their material palette and architectural expression.

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="9e8c64c2-881b-49e1-8c90-6b6acaaa45b6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010C%20-%20CGI%20-%20View%203.jpg?VersionId=Qm8_8H_Xrg_sc4Mdjc59vlAcKF_5wRTb" />

The design is organised around what Woods Bagot describes as a "green heart", a landscaped communal open space that reinstates the leafy character removed when the site became an industrial storage facility. A new pedestrian laneway running through the site would improve permeability between William, North and Francis streets, linking residents through landscaped public spaces while activating the ground plane.

Residents would have access to communal gardens and shared recreation areas distributed throughout the development. Sustainability has also been prioritised, with the project targeting an average 7.9-star NatHERS rating. Proposed initiatives include rooftop solar generation, rainwater harvesting, passive solar design, naturally ventilated lobbies, extensive cross-ventilation and the reuse of existing building fabric to reduce embodied carbon.

The adaptive reuse strategy became a defining feature of the application after heritage investigations found only one of the site's industrial buildings could feasibly be retained. The Heritage Impact Statement concludes that preserving the key warehouse façades while referencing the site's industrial character throughout the new development provides an appropriate balance between renewal and conservation.

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="efffafdb-594f-4e2b-a067-921fd51c05e1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010D%20-%20CGI%20-%20View%204.jpg?VersionId=DPmE4.k16YRt0i27hEZVtJAffarpvUfx" />

"Retention and adaptation of the site buildings has been explored but found not to be feasible except for the tallest building, whose street facades will be retained," the heritage report states.

"The proposed building will interpret the brick and steel character of the subject site, including reuse of some components and construction of a large 'sawtooth' structure in the proposed open space."

<img alt="First look: Ceerose returns to Leichhardt with 203-apartment adaptive reuse proposal at former warehouse site" data-entity-type="file" data-entity-uuid="3bfef2b5-83f5-40cd-9cab-767092f34266" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Appendix%2010E%20-%20CGI%20-%20View%205.jpg?VersionId=7asb3i_ql4ybbuJOUb5UHBEIy0Q9t.DF" />

The William Street site is located around 300 metres from Leichhardt North Light Rail station and a short walk to Norton Street's retail, dining and hospitality precinct. The surrounding area has increasingly become a focus for urban renewal given its proximity to public transport and the Parramatta Road corridor.

Doueihi founded Ceerose in 1998 and has grown the business to become one of Sydney's more active apartment developers in recent years, with completed projects including The Alex Collective in Alexandria, Abbie's Lane in Annandale, and the award-winning Munro House in Elizabeth Bay. They are currently delivering Belgravia, 17 luxury apartments in Potts Point.

First look: Ceerose doubles down in Leichhardt with adaptive reuse of former warehouse site

Ask Margaret

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Hi Margaret,
I am a fortunate Aussie expat whom has just reached five years overseas. As expats our land tax exemption in Queensland is only $350,000 per person. 
My wife and I own two properties in Brisbane and are looking to purchase our third and future home.  Our tax planning strongly requires us to increase our current debt levels.
Unit : $200,000 land value, 50/50 ownership,principal place of residence up to end 2009.
Post war 810 square metre splitter: $405,000 land value, one title, 100% my name.
Future home: $800,000 to $1 million, 50/50 ownership.
Do you have any recommendation on how we can eliminate or reduce our land tax exposure after the purchase our new home while remaining oversees?
We are likely to face an $8,000 to 10,000 yearly land tax bill.  We have considered selling our unit as we can still access the capital gains exemption and going forward it is not likely to provide growth to match the cost of land tax.
I look forward to your assistance.
Thanks
Julyan 
Hi Julyan,
It always worries me when the tax accountant’s response to saving tax is to increase your level of borrowing.
While I support borrowing to invest, the amount of debt you ultimately obtain must suit your personal appetite for risk, not some accountant’s attempt to reduce your tax.
It’s all very well to say ‘get more debt’ but to do so without care and extremely careful planning around what you buy might just end up diverting those saved taxes into property losses when you buy the wrong property!
You cannot get the usual principal place of residence (PPOR) exemption on your land tax as you do not reside here – and so the normal thresholds that apply to property other than your own home apply to you, as you have so rightly pointed out. 
Once you make this next property your home, it will come under the exemptions, so maybe you need to consider the length of time it will be just an investment and calculate the total amount of tax you will actually be up for – then assess if this amount is worth getting into the market now. 
It could be that the amount of money you save by buying now, assuming what you buy goes up in value, is more than the tax you have to pay, making the payment worthwhile.
In addition to this you could: 
<ol>
<li>Explore how you can make your PPOR your own home – this may entail coming home for a month to live in the newly acquired property as soon as you settle, then invoking the six year rule to move out of it for up to six years.  While this deals with capital gains tax it may also deal with land tax too – you must check with the QLD office of state revenue for their policy on PPOR exemptions and it’s relation to land tax. 
</li>
<li>Instead of buying a property now to live in, instead look for additional investment properties but choose them in a state other than Queensland.  Land tax is a state based tax and you get a tax free threshold in each state!   Note that the threshold is different in every state, but this could allow you to add to your portfolio with growth assets without further burdening your land tax liability. 
</li>
<li>If you must stay in Queensland, consider buying a commercial property, where land tax is an outgoing recovered from the tenant.</li>
</ol>
Apart from these ideas, land tax is a fact of life and one which has no legal way of avoiding.  As with all tax advice though, be sure to contact an accountant to discuss your needs, and choose one who can demonstrate a sound knowledge of property investing tax matters.
Regards,
Margaret
Have a property question?  <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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mlomas-KC9MUPZ6Ca

Ask Margaret: How can I reduce my land tax exposure?

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Hi Margaret,
My partner brought a block of land in 2011. 
We were wondering whether we have a limited time to build a home before capital gains tax (CGT) is applicable to us?
Thanks in advance,
Ryan
Hi Ryan,
I am assuming that you purchased this block of land with the intent to build a property in which you will personally live, rather than build a property as an investment.  If it is to build as an investment, then of course CGT is going to apply immediately from the date of your contract to buy.
If you bought to build a house of your own on, the tax office <a href="https://www.ato.gov.au/General/Capital-gains-tax/In-detail/Real-estate/Treating-land-as-your-main-residence/" target="_blank">has this to say</a>:
"Generally, if you build a dwelling on land you already own, the land does not qualify for exemption until the dwelling becomes your main residence for capital gains tax (CGT) purposes.
"Vacant land may also be treated as your main residence if it is vacant because your home has been destroyed.
"However, you can choose to treat land as your main residence for up to four years before the dwelling becomes your main residence in certain circumstances. You can choose to have this exemption apply if you acquire an ownership interest (other than a life interest) in land and you:
<ul>
<li>
"Build a dwelling on the land
</li>
<li>"Repair or renovate an existing dwelling on the land, or </li>
<li>"Finish a partly constructed dwelling on the land.</li>
</ul>
"There are a number of conditions that you must satisfy before you can claim the exemption. You must first finish building, repairing or renovating the dwelling and then:
<ul>
<li>"Move into the dwelling as soon as practicable after it is finished, and continue to use the dwelling as your main residence for at least three months after it becomes your main residence."</li>
</ul>
Reading this it would appear that, as long as you do not own another property on which you are also claiming the principal place of residence exemption, you have four years to have the house ready to move into.  
Make sure you check with your accountant to see how this might apply to you though, as your personal circumstances may be very different.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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Ask Margaret: Is there a time limit to build on land before CGT applies?

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Hi Margaret,
I have just bought an investment property, which included doing a building inspection.
But prior to buying the property I also had a building inspection done on another property that I was looking to get as an investment which I did not go ahead with.
Are both building inspections tax deductible or just on the one I bought please?
With thanks
Geoff
Hi Geoff,
When buying an income producing property, the expenses which are associated with that are treated differently, depending upon what the expenses were and when they were incurred.
Where a building inspection is concerned, this is considered what we call a 'capital cost' and it is claimed by adding it to the cost base.  This means that you do not get an immediate deduction for it (as in, you cannot claim it in the year that it was incurred to get some of your tax back ion that year) - rather, it adds to your cost base and essentially reduces the gain you have to account for when you sell, reducing the amount of capital gains tax you must pay.
If you do not buy the property, you have no cost base to add it to so it is not claimable at all.
If you want to claim these kinds of costs, you must be in the 'business of buying rental properties' or in the 'rental property business'.  If your are assessed as being in one of those categories, then there are many extra things you can claim, but you will be treated like a business with all of the associated requirements and lose the 50% discount on CGT when you sell.
Regards,
Margaret
Have a property question?   <a href="mailto:askmargaret@propertyobserver.com.au">Ask Margaret!</a>
 
 
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Is a building inspection tax deductible if I didn't buy the house? Ask Margaret

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Hi Margaret,
I'm going to buy a property with my friend. Both of us  are renting at the moment and the property we are going to buy will be our first home.
We don't want to move as soon as we buy.
<ol>
<li>Will this affect the rental assistance we are getting from Centrelink?</li>
<li>Should we pay the capital gains tax (CGT) while we sell the house in future?</li>
</ol>
Regards,
Arabu
Margaret's answer is on the next page. Please click below.
<hr class="system-pagebreak">
Hi Arabu,
If both you and your friend currently qualify for Centrelink rental assistance, then you will need to be reassessed by Centrelink once you have acquired this new asset.   Rental assistance, just like any income support, is assessed according to an income and assets test and you need to see if you still qualify for the same level of, or any, rent assistance.
Centrelink will assess the net income of the property and this does take into account the net taxable income, which is what would be on your tax return.  They also assess your assets and in your case, if you already have a deposit for a property, this deposit would already be being assessed by Centrelink as an asset, and so it's likely that the additional income shouldn't affect your benefits too much, unless your deposit is really large and you own most of the property when you buy it.
As this property will be a rental first before it is your principal place of residence, then there will be CGT consequences when you sell it.  The gain will be assessed using a  formula which considers days rented and days not rented and proportions the gain accordingly.  It will be critical for you to keep all records including receipts of anything you spend on the property, for as long as you own the property,  so that your tax liability can be correctly assessed when you dispose of the property.
On another note, if your friend is not a spousal partner, I'd like you to be aware of the consequences which can arise when you enter property ownership with someone who you are not sharing financial circumstances with.  They include:
<ol>
<li>A lender will consider any loan repayments on a loan you are a party to as being all of your responsibility, in case your friend doesn't uphold their side of the arrangement.  This means if you apply for future borrowing to buy a property without your friend, the entire loan repayment is assessed as being owned by you and may affect the amount you can borrow. </li>
<li>If you and your friend end up with different ideas about when you wish to exit the property, there could be an issue. </li>
<li>If you and your fiend end up falling out, this is also a problem as it's hard to own a property with someone you no longer associate with. </li>
<li>If the property gains in value, you can only leverage against this gain for a further property with your friend, since they own the equity too.</li>
</ol>
It's always a better plan to invest alone than to invest with friends or relatives.
Kind regards,
Margaret
Have a property question?  <a href="mailto:askmargaret@propertyobserver.com.au">Ask Margaret!</a>
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How will buying with my friend affect my benefits? Ask Margaret

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Hi Margaret,
I am going to sell my family home and move into a new home.
But it's taking time to sell, so I wanted to take my first home off the market for a while and move into the new one, then sell at a later date. 
I won’t rent out my former home, so will I avoid CGT? 
Kind regards,
Andrea
Hi Andrea,
Capital gains tax (CGT) is one of the most misunderstood concepts in property investing, but in reality it’s quite simple.
CGT is not about whether you rent out a property or not, and many assets attract CGT even though they don’t produce income for you. When it comes to CGT on your family home, it is all about which property you intend to claim as your principal place of residence (PPOR), and you can only claim one. Any other property you own, regardless of if it is rented out or not, will accrue CGT. The value that becomes the cost base upon which the gain is calculated will depend on a host of things, from when it was purchased through to when it ceased being your principal place of residence exemption.
You can move out of your  PPOR for up to six years and still maintain an exemption on it, as long as you don’t have another property for which you claim that exemption. This allows home owners to be relocated for work, or move out and rent for a time, without CGT accruing. Remember that if you buy another property in that time, you must nominate one as your PPOR, and your intention for the nominated property is that it must be genuinely a home you have intention to reside in.
You are allowed a six-month overlap, however, so that you have time to move and set up a new principal place of residence.  Be very careful on this one, though – if you go over the six months  by even one day you may end up paying some CGT on the family home, calculated in most cases on the change in value form the day you moved out until the day it sells. This might be OK if the value has not increased since you moved out, but if there has been any type of value increase since you left it, you could be up for some tax.
Try not to be too alarmed – remember  CGT is incurred on only half the gain (as long as it has been held as an asset over 12 months) and although it is tacked on to the top of your other income and calculated at your highest marginal rate of tax, this may be a fairly small amount after all.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au">Ask Margaret!</a>
This article was first published on Property Observer in February 2013.
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Can I avoid CGT when I sell my home? Ask Margaret

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Hi Margaret,  
I am an international student who has just graduated and I am planning to move back for good.
My parents are considering selling their apartment in Bondi Junction.
In your opinion, do you think we should sell?
Or would you recommend that instead of selling we keep the apartment and rent it out instead?  
Thank you for any information and advice you may be able to provide, it is very much appreciated.  
Kind regards,
Irene
Margaret's answer on the next page. Please click below. 
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Hi Irene,
The decision about whether to keep a former owner occupied property, or instead rent it out, involves a lot more considerations than just whether the time is right or if it will make a good investment, although these two matters are definitely part of the analysis.  
It’s hard to know exactly where to start and so the following information is not necessarily in order of how the considerations need to be made, but all of them must be considered:  
<ul>
<li>
A principal place of residence is capital gains tax free as long as it’s sold within the allowable period.  Your parents can move out of the apartment and keep it CGT free up to six years, as long as they do not have another property on which they claim the principal place of residence exemption.  If they do move out and buy another property, they can have a strict six month period of overlap where they can have two exemptions, but if this is missed by even one day (that is, the property is not sold) then they are liable for CGT on one of the properties right back to when they first moved out.
</li>
<li>This is important because if instead they sell and take the tax free gain, they can use this to buy another owner occupied property with low or no debt.  If they wish, they can borrow against the equity in that new owner occupied property and invest elsewhere, with a fully tax deductible debt.</li>
<li>
If they keep the Bondi apartment and rent it out, only the property's current debt can be claimed as a tax deduction.  Even if they use that property as security for further funds to buy another home of their own, that debt is not a deductible one as it is the purpose for the loan, not what secures it, which determines tax deductibility.  In some cases people doing this end up a little upside down – they have a large debt on a house they live in (with no deductions allowed) and a small one on an investment.
</li>
<li>
People often keep a former home because they think it will make a ‘good investment’, and this is based on emotion rather than any researched facts to support whether or not it is a good place to invest.
</li>
</ul>
The first thing to consider is whether or not this area has the capacity to deliver as good as, or better, growth and yield than any other area. 
Keeping it may prevent your parents from investing in an area with a better capacity to grow in the coming few years and a higher rental yield, giving an all- round better performance. 
Usually, areas which have already become ‘blue chip’ have their best period of performance behind them, and unless there is some major development or infrastructure project on the way, such an area is more than likely to grow with only a lacklustre result. 
For sound investing and a return better than bank savings interest rates, you need to find an area on the cusp of its best period of growth (as in a pre- blue chip area) and you are not likely to find that in the upmarket, favoured suburbs of our capital cities. 
Great investing opportunities are usually in formerly remote suburbs or newer suburbs catering to families – the kind with major infrastructure projects ahead of them and burgeoning populations which drive year- in, year- out growth in value and rental yield.  
It’s rarely the right thing to keep a former home and make it into an investment. 
Your parents need some good advice from a qualified property investment adviser, one whose best interests are not served by selling them a property, to ascertain their bottom line financial position in relation to any debt on this property and any they may move to and to establish just what will be the most appropriate strategy for this time in their lives.
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
This article was first published on Property Observer in July 2013.
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Should I turn my home into an investment property? Ask Margaret

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Hi Margaret,
Myself and a friend have decided to bid at auction for a block of land in <a href="/news">Westmead</a>, NSW.
We have verbal approval from council’s town planner to build a duplex on this land.
I appreciate it if you could help me with following:
<ul>
<li>Would the council usually be able to provide written confirmation regarding approval to build the duplex? 
</li>
<li>As this is just a block of land, what are the charges or taxes we have to pay before building. 
</li>
<li>Is there any step by step guide to go through all the formalities we need to complete post signing the contract of the land? 
</li>
<li>Do we need to make sure of anything before we go and win the auction?</li>
</ul>
Regards,
Hitesh
Margaret's answer is on the next page. Please click below.
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Hi Hitesh,
It’s always a risk when buying a property which you think might be able to be subdivided. 
Many years ago, I purchased a block in Queensland and prior to the purchase I had a lengthy discussion with council in which I was advised that I could potentially build a triplex. Upon settlement, I commenced the approval process to be told that only a duplex would be possible. Just before I got the application finalised, the councils merged and my application for a duplex was rejected. Due to where this property is, building a single dwelling is a loss making exercise and I now have a technically useless, non-income producing block of land!
I tell this story to indicate the potential problems you could have.  The council will not provide written confirmation to you prior to bidding, as everything can change in the meantime and they will not want to be locked in.  They will simply refer you to the current town plan and the existing development application rules and suggest you use them as a guideline.
There are no taxes to pay to build, but the ‘charges’ can be endless.  Subdivision approval is complex and requires the services of town planners, architects, surveyors, geo tech experts, and engineers, to name a few.  A simple duplex subdivision can run to tens of thousands just for the approval to build and if driveways and retaining are also involved, expect to reach costs of over $100,000!
Your local council should have a guideline for subdivision approval on their website (or a document they can send you) but good luck with that! 
In my experience it is complex in the extreme, and it can be laborious translating what is actually required.  This is why it is a good idea to retain the services of a town planner, preferably one who may have previously worked for the council in question.
I’d initially download that guideline and contact a town planner prior to auction to get an idea of the costs of the subdivision.  This person will be able to quote on getting the ‘approval to subdivide’ (which is step one) but be aware that, after this step you have to carry out all works and steps outlined in this approval before your final deposited plan number will be allocated.
Regards,
Margaret
Have a property question? <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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What hurdles will I need to jump to subdivide land? Ask Margaret

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Hi Margaret,
Is stamp duty payable on a transfer of real estate from father to sibling or vice versa?
Please help. What would be the best way to do this transfer?
Regards,
Neville
Margaret's answer is on the next page. Please click below.
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Hi Neville,
The answer to depends upon which state you live in.
For example, if you live in NSW and the property is located there, then the stamp duty which would apply will be the same amount that you would pay were you to buy the property.  This means that the property must be valued by a duly qualified person and then stamp duty is assessed on the basis of this valuation. 
You will also have the costs of a solicitor or conveyancer, who must still have the property conveyed to you and so will charge you for that in a similar way to how you would be charged if it were a purchase.
Where property is transferred between family members, it's theoretically possible to transfer property using a 'transfer' form and without going to the expense of having a full contract for sale prepared, with appropriate disclosure documents such as title searches and council zoning certificates. You may prefer to use the usual contract for sale however, as this will protect all parties to a greater degree.
In some states there may be an exemption for transfer between family members, although this usually applies only to spousal transfers.  Depending on the nature of the real estate some exemptions may apply - property used for primary production (family farm) may be exempt and other real estate might have some exemptions depending upon the circumstances around the transfer.
Also be aware that, depending upon the nature of the property for your father (for example if it was his investment property), there may be capital gains tax to be paid.
I find the offices of state revenue in each state are very helpful, so you should give them a call and discuss your personal circumstances.
Kind regards,
Margaret
Have a property question?   <a href="mailto:askmargaret@propertyobserver.com.au" target="_blank">Ask Margaret!</a>
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Do I need to pay stamp duty if I transfer a property to a family member? Ask Margaret

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Hi Margaret,
I was reading one of your articles. 
I'm wondering: Say I purchase my first property but don't live there. Instead, I rent it out for income. Say 10 years later, when I sell this property, how do I avoid paying Capital Gains Tax (CGT) - assuming this is my only property in the next 10 years?
What would happen if I make deduction on the interest of the loan, or do not making any deduction at all? Is the latter legal, from the ATO's point of view?
Thanks. Wesley
To read Margaret's answer, click below.
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When you own, and occupy, a home of your own, you may claim a 'principal place of residence' exemption on that property.
This means that, when you sell the property, you will not pay any capital gains tax on any gain you have made.
Further, if you move out of your principal place of residence (PPOR), you may rent it out, and claim any related tax deductions, for a period of up to six years and, as long as you either move back in, or sell it, before those six years are up you also will not pay any CGT. The only catch is that, during this 6 years you cannot own another property on which you would like to claim the exemption – you can only claim one exemption at a time.
The operative word here is 'own and occupy'. If you buy a property and you do not move into it as soon as it settles, then the property is not considered to be your principal place of residence until such times as you do move in, regardless of whether it is the only property you own, or not.
While you can move in at any stage and make it your PPOR, thus invoking a potential six year rule exemption at a future date when you move out, the fact that you did not live there from the moment you owned it changes a few things. You have to keep all of your records accurately on everything you spend, and then when the time comes to sell, your CGT liability must be worked out proportionately for days rented/days not rented.
Your cost base would be the cost base as at the date you bought it and then the gain is apportioned after the six year period is accounted for.
This can easily be overcome, as long as, when you buy the property, your intention is to live there and you move in when you settle, thus establishing the property as your PPOR. 
If, at a later date, your plans change and you move out, the six year period can commence, and your cost base for CGT would be the value as at the date the 6 years expire, if you don't move back in.  You can reset a new 6 year period at the end of the first by moving back in for a time.
Note that the tax office does not prescribe how long you have to stay there on either occasion – it just has to be your intention to live there and you must move in.
 
 
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Ask Margaret: How can I avoid CGT if my first home is an investment property?

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Hi,
I'm thinking about purchasing a property that has been built in underneath with no council approval. The problem is that it is a high set home on recently flood zoned area of <a href="/news">Logan</a>. My question is, is it still possible to get building certification for lower levels in flood areas or does the council never allow it?
Margaret Lomas' answer is on the next page. Please click below to continue.
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When you own a house or unit in any local government area, it is your duty to ensure that the building codes provided by the state department of planning, and administered locally by the council's own planning departments, are adhered to. 
This also means that, if you make any changes to a property which has previously been approved as compliant, you must first ask council for permission to make such changes.
These rules exist for many reasons - to ensure that an area remains aesthetically pleasing, to provide safe living environments for residents, and to protect the environment itself. If you have ever visited a country where there is no building code, and seen how the residential areas look when people build whatever they like, you will better appreciate these rules! 
You will also know that when a natural disaster strikes, the loss and injury caused is far more catastrophic, often due to the unsafe nature of what has been built and the overbuilding of those areas.
And so to your dilemma. You are thinking of buying  property with an unapproved alteration, and you should know that the council is within their rights to ask you to revert it back if they so desire. If the council feels for any reason that the alteration contravenes the current development rules, or in any way poses a risk to the surrounding community in the event of a flood, then they will ask you to revert it. 
You should check the flood maps available on the Logan City Council website, and see if this property falls within a flood zone. If so, your chances of having this alteration retrospectively approved is next to none, and the chances of being asked to remove the alteration is in play.
You should ask the current owner to either have the alteration approved prior to your purchase, or provide a letter from the council attesting to the fact that the alterations do not contravene any planning rules, and would be otherwise approved if you submit a development application. Then, as soon as you settle, take the steps to have the alterations approved to remove any future doubt.
 
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