<p>The new <a href="https://www.apartments.com.au/new-apartments/yarraville-green-42-stephen-street-yarraville-vic-3013">Yarraville Green</a> development in Melbourne's inner west is showing that landscaping can be just as influential as architecture, with buyers responding strongly to the garden-first approach adopted from the outset by developer Excelon Projects and the project's design team.</p>

<p>Excelon appointed Six Degrees Architects and landscape architects SBLA to work collaboratively on the development, with a brief to create "a sustainable, design-led building with a focus on community."</p>

<p>That approach has resonated with buyers. According to Next Chapter Director Tom Hirini, who is leading the sales campaign, the landscaped communal garden has become one of the project's defining features, alongside its boutique scale and European-inspired cluster housing concept.</p>

<p>Local downsizers, right-sizers and established families already living in Yarraville and surrounding suburbs have accounted for the majority of purchasers.</p>

<p>[smartcode_project:default project_id=144913 project_image_fid=297740]</p>

<p>Yarraville Green will comprise 53 homes, including apartments and townhomes, arranged around the shared central garden to maximise connections to the landscaped open space. Parking has been moved underground, allowing the ground plane to be dedicated to greenery, pedestrian movement and communal spaces.</p>

<p>The landscape extends well beyond passive planting. Productive garden beds, a pergola, communal gathering spaces, garden sheds and a pet wash have all been integrated into the masterplan, creating spaces designed to encourage everyday interaction between residents.</p>

<p>[smartcode_project:default project_id=144913 project_image_fid=297741]</p>

<p>The interiors continue Excelon's focus on craftsmanship, incorporating bespoke elements by Melbourne artisans including leadlight detailing by Adadaz, hand-turned timber hardware by Auburn Woodturning and blown-glass lighting by Ruth Allen.</p>

<p>Sustainability has also been embedded throughout the project, with Yarraville Green targeting an average 7-star NatHERS energy rating through passive design principles, rooftop solar servicing common areas and rainwater harvesting for landscape irrigation.</p>

<p>[smartcode_project:default project_id=144913 project_image_fid=297735]</p>

<p>Construction continues to progress at Yarraville Green, with structural works well underway and framing works approaching completion under builder Balmain &amp; Co. The project remains on track for completion in mid-2027.</p>

<p>Apartments at Yarraville Green are currently priced from $625,000, while townhomes start from $1.4 million.</p>

<p>[smartcode_project_cta:default project_id=144913]</p>


Joel Robinson

Garden-led design drives buyer demand at Yarraville Green

<p>National diversified developer Fortis has officially launched Crest &amp; Walker, its latest Brisbane apartment development, with construction now underway on the 20-storey Newstead project.</p>

<p>Award-winning builder BINAH has commenced construction on the Bureau^Proberts-designed building, which will deliver a limited collection of 65 two and three-bedroom apartments on Kyabra Street.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373556]</p>

<p>The project marks Fortis' fourth active residential development in Brisbane, following River House, which is nearing completion, alongside projects in New Farm and Hamilton as the national developer continues to expand its South East Queensland pipeline.</p>

<p>Fortis General Manager – Development Queensland Dan Boman said Crest &amp; Walker reflects the developer's long-term commitment to delivering design-led residential projects in Brisbane's established inner-city suburbs.</p>

<p>"We're proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such a sought-after lifestyle destination as Newstead," Boman said.</p>

<p>"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.</p>

<p>"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane's most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373559]</p>

<p>Positioned between Gasworks Plaza and James Street, <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> has been designed as a boutique residential address offering privacy and generous living spaces within one of Brisbane's most established lifestyle precincts.</p>

<p>The building features a contemporary brick podium softened by integrated landscaping, while the upper levels are characterised by restrained architecture and enduring materiality. Interiors have been designed to maximise natural light, acoustic performance and long-term liveability.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373583]</p>

<p>Residences comprise spacious two and three-bedroom floorplans, with two-bedroom apartments priced from $1.55 million and three-bedroom, half-floor residences from $3.95 million.</p>

<p>Residents will have access to a wellness-focused rooftop featuring a swimming pool, sauna, steam room, landscaped dining spaces and outdoor lounge areas overlooking Newstead and the Brisbane CBD.</p>

<p>[smartcode_project:default project_id=145922 project_image_fid=373571]</p>

<p>Sales are being managed by Slaite Projects, with Fortis expecting strong demand from owner-occupiers seeking a high-quality, design-focused apartment in one of Brisbane's most tightly held inner-city suburbs.</p>

<p>Completion of Crest &amp; Walker is slated for late 2028.</p>

<p>[smartcode_project_cta:default project_id=145922]</p>


Fortis expands Brisbane pipeline with launch of Crest & Walker in Newstead

<p>The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.</p>

<p>It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 41-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.</p>

<p>Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.</p>

<p>While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=68833]</p>

<p>Developer Bensons Property Group is behind the 41-storey tower, which has 229 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.</p>

<p>The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.</p>

<p>"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.</p>

<p>"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.</p>

<p>"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=360215]</p>

<p>One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.</p>

<p>"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.</p>

<p>While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.</p>

<p>"The size of the site is something that would be incredibly difficult to replicate today," she says.</p>

<p>"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."</p>

<p>[smartcode_project:default project_id=6515 project_image_fid=68839]</p>

<p>There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.</p>

<p>As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.</p>

<p>"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.</p>

<p>A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.</p>

<p>The remaining apartments are ready to inspect in person, by appointment.</p>

<p>[smartcode_project_cta:default project_id=6515]</p>


A decade in the making: Residents to move into Chevron One as construction wraps up

<p>A general rule of thumb in new apartment developments is that the penthouses get the rooftop.</p>

<p>It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.</p>

<p><a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.</p>

<p>Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.</p>

<p>The philosophy has reached its most ambitious expression at <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> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374053]</p>

<p>"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.</p>

<p>"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.</p>

<p>"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374052]</p>

<p>The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.</p>

<p>Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=372547]</p>

<p>The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.</p>

<p>The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=374054]</p>

<p>Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.</p>

<p>Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.</p>

<p>[smartcode_project:default project_id=150017 project_image_fid=370962]</p>

<p>While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.</p>

<p>It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.</p>

<p>Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.</p>

<p>[smartcode_project:default project_id=146527 project_image_fid=366550]</p>

<p>That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.</p>

<p>Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.</p>

<p>[smartcode_project_cta:default project_id=150017]</p>


Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

<p>As apartment living continues to evolve across Sydney's growth corridors, the quality and distribution of shared spaces is increasingly shaping how residents experience home. Rather than functioning as add-ons, amenities are being embedded into the daily rhythm of a building, supporting everything from quiet retreat to social interaction, often within a single vertical community.</p>

<p>At <a href="https://www.apartments.com.au/new-apartments/aeris-melrose-park-nursery-street-melrose-park-nsw-2114">Aeris</a> in Melrose Park, this approach is resolved through a layered amenity offering that unfolds from ground level through to its upper podium. Developed by <a href="https://www.apartments.com.au/developers/sekisui-house-australia">Sekisui House Australia</a> in partnership with Hankyu Hanshin Properties, the project introduces 468 apartments across two towers and a mid-rise building, positioned at the highest point of the broader masterplan.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=359199]</p>

<p>The amenity experience begins at street level, where two courtyards sit within a landscaped setting that connects residents to the wider network of parks and green spaces. These green spaces are not isolated pockets but part of a wider pedestrian network that links Aeris to the surrounding <a href="https://www.apartments.com.au/developments/melrose-park-nsw-2114">Melrose Park</a> precinct, including Central Park, future schools, and the Town Centre opening in July 2026. The result is a transition that moves from public to private without abrupt boundaries, allowing residents to pass through shaded, tree-lined environments before reaching the building itself.</p>

<p>Moving upward, the focus shifts to the level five podium, where the primary communal facilities are concentrated. This space brings together a 16-metre swimming pool, outdoor seating areas, and a communal BBQ zone arranged to take advantage of elevated outlooks. Seating is positioned beneath pergolas, creating pockets of shade that extend the usability of the space throughout the day. The pool edge aligns with views toward the wider district, reinforcing the sense of elevation that defines the project’s positioning.</p>

<p>In the adjacent building, this is complemented by quieter, more contemplative spaces, including an outdoor cinema set within the same level. Positioned to operate primarily in the evening, it introduces a different tempo to the shared environment, shifting from daytime activity to after-hours use without requiring separate zones.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=360299]</p>

<p>The podium also accommodates an intimate private resident gym. Located on the lower levels, it gives residents convenient access to fitness facilities without leaving the building.</p>

<p>Above, the elevated podium sky deck extends the amenity offering, providing additional open-air spaces with elevated outlooks across the surrounding landscape. While more restrained in program, this upper level reinforces the project’s vertical progression, from ground-level greenery to elevated outlook, allowing residents to move between distinct spatial conditions within a single address.</p>

<p>This distribution of amenities reflects a deliberate response to how residents use space across the day. Sekisui House Australia Sales and Marketing Director Peter Kalaf points to the role these shared areas play in shaping buyer demand. Aeris has been conceived as more than a collection of apartments, with the podium pool, gym and outdoor cinema forming part of a broader lifestyle offering that extends the home beyond each individual residence.</p>

<p>[smartcode_project:default project_id=426 project_image_fid=360300]</p>

<p>What distinguishes Aeris is not the inclusion of these elements individually, but how they are arranged in relation to one another. Active, social, and passive spaces are layered vertically rather than separated, allowing residents to choose between them without leaving the building or moving far from their apartment. This proximity supports both routine use, such as a morning swim or evening workout, and more occasional gatherings, whether around the BBQ area or within the cinema setting.</p>

<p>The amenity design also sits within a broader framework of connectivity across Melrose Park. The Melrose Park Town Centre, anchored by Coles and Dan Murphys, features a mix of retail, dining, health and lifestyle offerings, bringing everyday convenience closer to residents. By the end of the year, more than five hectares of parks and open space, equivalent to around seven football fields of green space on residents' doorstep, will further enhance the precinct, allowing the internal facilities at Aeris to operate as an extension of the wider neighbourhood rather than a substitute for it.</p>

<p>Construction at Aeris continues to gather momentum, with ground floor slabs expected to be completed in late 2026 before the first sections of the buildings begin to rise above ground.</p>

<p>[smartcode_project_cta:default project_id=426]</p>


Elevated amenity anchors daily life at Aeris, Melrose Park

Taxation

<html><body>
<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p>The government is still consulting on superannuation after concerns raised by backbenchers over changes made in the budget. However these changes are more important than ever, as evidenced by the 2016 HILDA statistics on wealth and superannuation.</p>
<p>The statistics highlighted changes in the distribution of wealth of Australians since the survey commenced in 2001. The most significant assets held by most Australians continue to be their family residence and superannuation, but policy changes over the time of decade the survey have changed the balance of those investments.</p>
<p>More concerning is the finding that wealth inequality has increased. The data adds strength to the argument that superannuation reforms are overdue, with a small number of wealthy people able to accumulate wealth in superannuation and investment property.</p>
<p>In Chapter 5 of the report, which discusses household wealth, the authors note that superannuation will soon overtake the family home as the major asset owned by Australians. This is the result of two separate trends: increases in superannuation balances and lower net wealth in housing.</p>
<p>Looking at the HILDA data, it’s not unexpected to see that younger age cohorts have experienced the strongest growth in superannuation assets.</p>
<p>Prior to 1993 superannuation was very different to the current system. According to Treasury data in 1986 53.5 percent of Australian full time employees did not have superannuation coverage, and over 80% of those who did, were members of a defined benefit scheme, which would not generally be reported as an asset. By 2000, 96.9% of full time employees had superannuation coverage, with 86% of those employees in accumulation type funds.</p>
<p>The superannuation guarantee has been a significant contributing factor in the importance of superannuation as a household asset. Notably, the phasing in of the rate of the superannuation guarantee shows in account balances. As can be seen from the HILDA report the increased rate of superannuation guarantee after 2002 has resulted in higher superannuation balances for people at the same age in successive surveys.</p>
<p>The increase in housing values is the second trend which has altered the mix of assets. Over this time residential house prices rose significantly, with ABS data showing an increase in the Residential Property Price Index across eight capital cities from 69.0 in September 2003 to 120.2 in Dec 2014.</p>
<p>Given that in the 2002 data the major asset of Australians was the family home, homeowners benefited disproportionately from the increased value of housing. Even with the significant increases in superannuation, for older Australians the proportion of wealth held in housing has been maintained as their total wealth has increased.</p>
<p>However for younger age groups the story is not as positive. The rate of home ownership is declining as it is becoming more difficult to enter the housing market and home equity is declining among younger age groups as the value of loans has increased.</p>
<p>The HILDA data shows that most age cohorts, including all except the oldest retirees, have seen increases in their superannuation accounts over time. Policy changes effective from 2007 have supported superannuants through tax exemptions and high contribution levels.</p>
<p>Another trend contibuting to this is that people are retiring later. The change in the pension age to 67 has been accompanied by a trend for people to work longer. Not only are they deferring withdrawals from their superannuation fund, but they are also continuing to contribute during this time.</p>
<p>As noted in the Productivity Commission report last year there is some evidence of withdrawals at the time of retirement, but these are generally used to pay outstanding debts, including mortgages against the family home.</p>
<p>Others convert their superannuation at retirement into other financial investments. This cements the family home as the most significant asset held by retirees.</p>
<p>The more concerning finding for policy makers is that wealth inequality has increased, and that superannuation holdings and investment properties are factors in this inequality. HILDA data shows that in 2014 the mean superannuation balance of the top 10% of people aged 50 to 69 was $991,268, up from $650,619 in 2002, compared to $210,798 in 2014 for the sixth to ninth decile and $13,719 for the bottom 50% (although a significant number of retirees in this age group do not have any superannuation balance).</p>
<p>There is a strong correlation between high superannuation balances, income and non-superannuation wealth. People in the top decile have access to higher levels of income to make higher levels of concessional contributions, and the ability to find the funds to make non-concessional contributions into a tax preferred investment environment.</p>
<p>As has been noted previously, the current superannuation system allows high income and high wealth individuals to over-accumulate in tax preferred superannuation, which increases wealth inequality as well as intergenerational inequality.</p>
<p>The Government proposals to restrict the level of contributions and to reduce the amount that can be retained in a tax free environment are important tools to address increasing levels of wealth inequality in our community.</p>
<p><em><span class="fn author-name">Helen Hodgson is </span>associate professor, Curtin Law School and Curtin Business School, Curtin University and author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/helen-hodgson-94553" target="_blank">here</a>.</em></p>
</body></html>

jchancellor-FAypfDUnLy

Wealth inequality shows superannuation changes are overdue

<html><body>
<div>It's the end of financial year!</div>
<div> </div>
<div>It was a really strong finish to the year for share markets today, closing up by 1.8 percent. However, the Aussie stock markets finished the financial year down by an underwhelming 4.1 percent.</div>
<div> </div>
<div>With the tax year now having come to an end, it will soon be time to lodge those tax returns.  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Holiday homes under scrutiny this year</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Last year, the Australian Taxation Office (ATO) designed and implemented new compliance strategies for foreign investors in Australian property, including stakeholder engagement (with advisers, agents, and associations), improved data matching, and a broad investigation strategy into illegal foreign purchases.</div>
<div> </div>
<div>This year - as well as those claiming excessive work-related expenses such as travel expenses, self-education, uniform, mobile phone, and internet costs – it is resident Australians with rental properties that are more likely to be under scrutiny from the ATO at tax time - in particular those will holiday homes.</div>
<div> </div>
<div>During the past year ATO Commissioners have advised Farifax Media and SBS News that they have been in contact with thousands of owners of rental properties in order to clarify their entitlements or request clarification about claims that they've made. </div>
<div> </div>
<div>The ATO has further reportedly sent correspondence to some holiday home owners recommending that they "review the nature of their claims" before dropping in their next returns...oops!<br><br>
</div>
<div>With well over 2 million Australians lodging tax returns declaring ownership of a rental property - spread widely across all income brackets – the landlord sector is substantial, and there are potentially significant liabilities to be raised by the ATO.</div>
<div> </div>
<div>Click to enlarge</div>
<div><img src="/images/2016/07/01/ATO1.jpg" alt=""></div>
<div> </div>
<div>Owners of holiday homes should take a good deal of care not to make claims for net rental losses for periods when their property has not actually been made available for rent. </div>
<div> </div>
<div>In particular owners of holiday homes claiming deductions for a full year when the property has been vacant for long periods might expect to get a tap on the shoulder from the tax office.</div>
<div> </div>
<div>According to ATO legislation the principles that apply to a rental property also apply to a holiday home if it is rented out - if you rent out your holiday home, you can claim expenses for the property based on the proportion of the income year it was rented out or was genuinely available for rent.</div>
<div> </div>
<div>However, if a holiday home is advertised in ways that limit its exposure to potential tenants, then the property may not be deemed “genuinely available” for rent – for example, if the property is not widely advertised, or if the advertised rents are set at unrealistically high levels.</div>
<div> </div>
<div>Since the ATO’s interest was flagged some months ago, net rental losses declared or claimed on holiday homes could be lower this year as this loophole is sewn up...</div>
<div> </div>
<div><strong><span style="text-decoration: underline;"><em>Airbnb </em>and online networks</span></strong></div>
<div> </div>
<div>There may also be some confusion relating to the rise of online networks such as <em>Airbnb</em>, with more Australians than ever before choosing to rent out their own homes, or a part of their homes. </div>
<div> </div>
<div>Remember, rental income is assessable and therefore you may have tax to pay at year end - don't try to be sneaky and under-report rental income it or you may be penalised! </div>
<div> </div>
<div>For <em>Airbnb</em> hosts there are two types of allowable deductions. Firstly, there are costs directly associated with generating rental income or with the rental area (for eaxample, photography, commercial cleaning costs, food for tenants, <em>Airbnb</em> fees and commissions, or food made available to tenants). </div>
<div> </div>
<div>And secondly there are costs which may be apportioned, often based upon the applicable floor area, including your mortgage or rent, utilities, internet and phone costs, insurance, and so on.</div>
<div> </div>
<div>Keep records and receipts through the financial year and make sure you set aside some money for the tax liability!</div>
<div> </div>
<div>Also, be aware of the potential legal and liability risks or short term tenancies and other tax implications thereof, such as capital gains tax (the principal place of residence is normally exempt, but generating rental income from the home may trigger a change in this status).  </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Repairs and maintenance</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>There is also often genuine confusion for some property investors over what deductions can be claimed.</div>
<div> </div>
<div>Perhaps the most common mistake made by landlords on lodged tax returns is claiming deductions for repairs and maintenance for expenses which are actually capital costs. </div>
<div> </div>
<div>Property investors are not allowed to claim repairs and maintenance deductions for defects or pre-existing damage that was in evidence at the time they acquired the property. Such improvements are considered to be capital in nature.</div>
<div> </div>
<div>Where investors are unsure they would be well advised to check the rules relating to deductions made available by the ATO for free online, or to engage a tax agent or property specialist tax accountant that is familiar with the rules. </div>
<div> </div>
<div><strong><span style="text-decoration: underline;">Net rental losses declining</span></strong></div>
<div><strong><span style="text-decoration: underline;"> </span></strong></div>
<div>Declared net rental losses have declined sharply in recent times, falling by more than half over the last two tax years for which data is available, largely due to lower interest rates. </div>
<div> </div>
<div>The average net loss claimed by investors has fallen by 64 per cent since 2008 as mortgage repayments have become cheaper. These figures will continue to decline in 2015 and 2016 with interest rates having fallen.</div>
<div> </div>
<div><a href="/images/2016/07/01/NG.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG.jpg" alt=""></div>
<div> </div>
<div>While the ATO will doubtless generally be looking for expenses claimed in error as part of their investigative reviews or audits, it is worth noting that many investors also fail to claim deductions which they are entitled to. </div>
<div> </div>
<div><a href="/images/2016/07/01/NG2.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/07/01/NG2.jpg" alt=""></div>
<div> </div>
<div>In particular, not all owners of rental properties are aware of the potentially generous capital allowances and tax depreciation deductions for plant and equipment which are available under the tax legislation.</div>
<div> </div>
<div>If you are in doubt, a property specialist tax accountant can help you to avoid making costly mistakes!</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
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Tips and traps for property investors: Pete Wargent

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<p>Taxing foreign buyers, rather than any new hand outs to first home buyers was the focus of the NSW State Government budget.</p>
<p>Treasurer Gladys Berejiklian said she wanted to be cautious when dealing with the property market.</p>
<p>The State Government is not tipping any Sydney property market correction, just a likely easing.</p>
<p>The state budget didn't raise or lower property taxes, other than the much anticipated new taxes on foreign investors.</p>
<p>All foreign property investors in NSW will be hit with a 4 percent stamp duty surcharge when buying homes and apartments and face an ongoing extra 0.75 per cent land tax surcharge on their residential property holdings.</p>
<p>Treasurer Gladys Berejiklian said she was confident the extra costs would not deter foreign buyers given other states had similiar measure.</p>
<p>"Economists say it is an inelastic market," she said, when asked if there could be any fallout.</p>
<p>The NSW Treasurer Gladys Berejiklian's second state budget anticipates a slowing in stamp duty revenues from home sales.</p>
<p>But they will still get $8,777 million in the next financial year, then $9,124 million in 2017-2018.</p>
<p>"I don't apologise for be very cautious when it comes to the property market," she said.</p>
<p>Residential transfer duties are tipped to rise at 4.4 percent annually over the next four years, "significantly more subdued than the pace see in recent years."</p>
<p>There was 13.6 percent growth in the current budget year, and a stunning 40 percent growth when the boom was its most robust in 2013.</p>
<p>The NSW State Budget officially revealed an extra $835 million extra stamp duty purchasing revenue will come from foreign buyers over the next four years.</p>
<p>It also expects $166 million is over the next four years from land tax on foreign investors.</p>
<p>NSW land tax revenues are forecast to rise at a faster rate than stamp duty revenues.</p>
<p>Land tax on investors will yield 8.1 percent higher revenue every year for the next four years, taking revenues from $3,136 million this year to $3,761 million in 2019-20..</p>
<p>The housing boom longevity is not being assumed by the NSW Treasury who suggest price growth was "moderating."</p>
<p>Transfer duty represents 29% of state government revenue. Land tax represents 11%.</p>
<p>The budget papers noted there was potential downside risk of a decline in the broader housing market.</p>
<p>On the upside was "the impact of low, and possibly even lower interest rates leading to stronger housing construction and consumer spending," the budget papers advised.  </p>
<p>There was no change to NSW first home buyer grants in the state budget with the January 2016 reduction from $15,000 to $10,000 triggering a smaller govenment outlay.</p>
<p>Just $96 million was spent on the first home new home scheme this year, down on the $115 million in the 2014-15 year. The first home exemptions and concessions are estimated to sit at $88 million next financial year.</p>
<p>"We are doing every thing we can for first home buyers," Berejiklian said.</p>
<p>"The key thing is to continue to focus on supply," she added noting that there had been record levels of 70,000 new homes in the year to April.</p>
<p>"We are spending on infrastructure in local areas conducive to housing." </p>
<p>She anticipated any glut in apartment numbers would contribute to housing affordability by putting "downward pressure on prices." </p>
<p>"I appreciate the challenges people go through to get into the market."</p>
<p>She also signalled her concern at the Federal Labor's negative gearing tax policy. </p>
<p>"Without being over dramatic I am concerned that the election of a Shorten government will jeopardise conditions in NSW," she said.</p>
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Taxing foreign buyers the focus of the NSW State Government budget

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<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p>Opposition Leader Bill Shorten told Q&amp;A viewers that the federal government spends more on negative gearing and capital gains tax discounts than it does on child care or higher education.</p>
<p>Is that right?</p>
<h2>Checking the source</h2>
<p>When asked for sources to support Shorten’s statement, an ALP spokesperson said the Grattan Institute has estimated the cost of the capital gains tax and negative gearing concessions at $11.7 billion per year.</p>
<p><em>The Treasury’s tax expenditure statement (TES) lists the cost of the capital gains tax discount as $6.15b for 2015-16. The TES does not list the cost of negative gearing, but using Grattan’s total figure and subtracting the value of the capital gains tax discount, this shows that the cost of negative gearing is around $5.5 billion… this cost exceeds the cost of child care assistance or university education as per the budget papers.</em></p>
<p>You can read the longer response <a href="https://theconversation.com/full-response-from-labor-spokesperson-61201" target="_blank">here</a>.</p>
<p>So, does federal government spending on child care or higher education outstrip the cost of revenue forgone due to negative gearing and capital gains tax (CGT)?</p>
<h2>How much does the government spend on child care subsidies?</h2>
<p>This year’s budget showed the federal government is estimated to spend about $8.2 billion on child care fee assistance in 2016-17. That’s comprised of about $4.2 billion for the child care benefit and about $3.9 billion for the child care rebate.</p>
<p><a href="/images/2016/06/21/image-20160614-17209-1gramrh.png" target="_blank"><span class="attribution">Click to enlarge</span></a></p>
<p><span class="attribution"><img src="/images/2016/06/21/image-20160614-17209-1gramrh.png" alt=""></span></p>
<p><span class="attribution">Budget Paper 1, 2016-17 Federal Budget.</span></p>
<p>Here’s a graph produced by the Parliamentary Budget Office showing how the cost of child care subsidies is projected to change over time.</p>
<p><a href="/images/2016/06/21/image-20160614-29225-1v45yz.png" target="_blank"><span class="attribution">Click to enlarge</span></a></p>
<p><span class="attribution"><img src="/images/2016/06/21/image-20160614-29225-1v45yz.png" alt=""></span></p>
<p><span class="attribution"><a class="source" href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Budget_Office/Chart_packs">Parliamentary Budget Office</a></span></p>
<div class="enlarge_hint"> </div>
<h2>How much does the government spend on higher education?</h2>
<p>This year’s budget shows that the federal government is estimated to spend about $9.5 billion on higher education in 2016-17, an amount which is fairly stable over the forward estimates period. It is projected to be about $9.4 billion by 2019-20.</p>
<p><a href="/images/2016/06/21/image-20160615-22416-5uy7q4.png" target="_blank"><span class="attribution">Click to enlarge</span></a></p>
<p><span class="attribution"><img src="/images/2016/06/21/image-20160615-22416-5uy7q4.png" alt=""></span></p>
<p><span class="attribution">Budget paper 1, 2016-17 federal budget.</span></p>
<p>Here’s a graph produced by the Parliamentary Budget Office showing how the cost of higher education expenses is projected to change over time.</p>
<p><a href="/images/2016/06/21/image-20160615-22411-1qzpsjt.png" target="_blank"><span class="attribution">Click to enlarge</span></a></p>
<p><img src="/images/2016/06/21/image-20160615-22411-1qzpsjt.png" alt=""></p>
<p><span class="attribution">Parliamentary Budget Office</span></p>
<h2>How much do negative gearing and capital gains tax concessions cost the government in revenue forgone?</h2>
<p><strong>Capital gains tax:</strong> As Labor’s spokesperson says, the Treasury’s 2015 tax expenditure statement (TES) lists the cost of the capital gains tax discount as $6.15 billion for 2015-16.</p>
<p>According to Treasury’s estimates of tax expenditures, the “cost” associated with the capital gains tax discount for individuals and trusts is estimated to be $6.8 billion in 2016-17, rising to $9.09 billion in 2019-20. Note that this estimate does not include any estimate for the concessional treatment of owner-occupied housing.</p>
<p><a href="/images/2016/06/21/image-20160615-22398-cw74xm.png" target="_blank"><span class="attribution">Click to enlarge</span></a></p>
<p><span class="attribution"><img src="/images/2016/06/21/image-20160615-22398-cw74xm.png" alt=""></span></p>
<p><span class="attribution">Budget Paper 1, 2016-17 federal budget.</span></p>
<p><strong>Negative gearing:</strong> This is where it gets tricky. Treasury does not regard negative gearing as a “tax expenditure” and thus does not provide any estimates for the “revenue foregone” as a result of it. So we have to look at other sources for estimates.</p>
<p>Labor has inferred from the Grattan Institute’s report that the cost of negative gearing is around $5.5 billion ($11.7 billion minus the $6.15 billion cost of the CGT discount).</p>
<p>Labor did not provide The Conversation with any Parliamentary Budget Office (PBO) estimates on the cost of negative gearing to The Conversation. Labor’s spokesman said only that the PBO estimated Labor’s plan to restrict negative gearing to new property and to halve the capital gains tax discount could raise $565 million over the forward estimates.</p>
<p>The Greens put the cost of negative gearing at somewhere around $4 billion a year.</p>
<p>A 2015 report by The Australia Institute said that modelling by National Centre for Social and Economic Modelling (NATSEM) estimated that:</p>
<p><em>negative gearing of residential investment property is currently reducing tax revenue by $3.7 billion per year.</em></p>
<p>Ben Phillips, Associate Professor at the ANU Centre for Social Research and Methods (who previously conducted the NATSEM modelling quoted by The Australia Institute), reported in February 2016 that:</p>
<p><em>We estimate that in 2017-18 the total tax savings from negatively gearing properties is $4.3 billion.</em></p>
<p>And I have previously estimated that negative gearing costs more than $5 billion per annum in revenue forgone – although that estimate was for the 2010-11 financial year when interest rates were considerably higher than they are today. It was also a “gross” figure that did not allow for the impact of interest expenses being carried forward to be offset against future capital gains tax liabilities.</p>
<p>So what’s the combined cost of negative gearing and CGT? Nobody knows for sure. It could be as high as $11.7 billion, as the Grattan Institute has <a href="https://grattan.edu.au/report/hot-property/">said</a>. It could also be lower.</p>
<h2>So does CGT and negative gearing cost more than child care or higher education?</h2>
<p>This year’s budget showed the federal government is estimated to spend about $8.2 billion on child care fee assistance and about $9.5 billion on higher education in 2016-17.</p>
<p>Using the estimates outlined above, the combined annual effective cost of negative gearing and capital gains tax discounts to the public purse in revenue foregone is somewhere between about $9 billion and $11.7 billion (although no-one knows for sure because of differing opinions on the cost of negative gearing).</p>
<p>So Shorten’s statement that Australia is “spending more at the Commonwealth level on negative gearing and capital gains tax discounts than we are on child care or higher education” is likely to be somewhere in the ball park – but it’s impossible to say conclusively.</p>
<h2>A word of caution</h2>
<p>It’s worth remembering that none of the major parties are advocating scrapping negative gearing altogether.</p>
<p>And finally, it is worth drawing attention to Treasury’s caution that its estimates of tax expenditures such as the capital gains tax discount assume that taxpayer behaviour is unaffected by the existence of the concessional tax treatment. That assumption that may not be valid in practice, so that these estimates:</p>
<p><em>do not indicate the revenue gain to the budget if specific tax expenditures were to be abolished…. care needs to be taken when comparing tax expenditures with direct expenditures as they may measure different things.</em></p>
<h2>Verdict</h2>
<p>Is Australia “spending more at the Commonwealth level on negative gearing and capital gains tax discounts than we are on child care or higher education”?</p>
<p>Nobody knows for sure, because of the difficulty in measuring exactly how much negative gearing tax breaks cost the federal government every year in revenue foregone. (Treasury cautions against comparing tax expenditures with direct expenditures as they may measure different things.)</p>
<p>Using available estimates, however, Bill Shorten’s statement is probably in the ballpark.</p>
<h2>Review</h2>
<p>I agree with this assessment of the statement. There are official estimates on the projected spending on childcare, education and the revenue foregone in relation to the capital gains tax discount, although as Treasury notes these figures may not be directly comparable. It is more difficult to estimate the foregone revenue in relation to negative gearing as there are no official estimates. Each model will come up with a different estimate based on the parameters used for the estimate.</p>
<p>I would also caution that the statement by Bill Shorten should be read in conjunction with proposed ALP policies in these areas. In particular, tax concessions on negative gearing and the CGT discount will be pared back but negative gearing will still be available to taxpayers currently holding investment properties, and the CGT discount will be halved but not removed.</p>
<p>Given the difficulties in identifying the cost of negative gearing and the problems inherent in comparing data measured differently, the statement is within reasonable estimates.<strong> – Helen Hodgson</strong></p>
<p><strong> </strong></p>
<p><em><span class="fn author-name">Saul Eslake is v</span>ice-chancellor’s fellow, University of Tasmania and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/saul-eslake-665" target="_blank">here</a>.</em></p>
<p><em><span class="fn author-name">Helen Hodgson is a</span>ssociate professor, Curtin Law School and Curtin Business School, Curtin University and author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/helen-hodgson-94553" target="_blank">here</a>.</em></p>
<p><em> </em></p>
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What’s the combined cost of negative gearing and CGT? Saul Eslake

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<p>New stamp duty and land tax surcharges imposed on foreign buyers of residential property in NSW, Victoria and Queensland could have repercussions for Frasers Property Australia.</p>
<p>Its boss Rod Fehring has noted they might affect all foreign-owned property owners and developers operating in Australia, including Frasers Property Australia, the former ASX-listed Australand business, which is now wholly owned by Singapore-listed and Thai-controlled Frasers Centrepoint.</p>
<p>In NSW, foreign buyers will be hit with a 4 percent stamp duty surcharge from June 21 and 0.75 percent land tax surcharge starting in 2017.</p>
<p>Queensland's 3 percent stamp duty surcharge commneces on October 1.</p>
<p>Both are following Victoria which will raise its existing 3 percent stamp duty surcharge and 0.5 percent land tax surcharge to 7 percent and 1.5 percent respectively on July 1.</p>
<p>Developers can apply for exemptions in Victoria, but these are at the discretion of Treasurer Tim Pallas to be deemed resident or non-resident.</p>
<p>The treasurers in NSW and Queensland are yet to announce any exemptions.</p>
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Frasers caught in wave of property taxes for property

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<p>SPONSORED POST</p>
<p>If you have bought an off-the-plan property, assessing that property post construction is an important part of the settlement process.</p>
<p>Of course, you want to ensure that the property you agreed to purchase is the same that is being delivered so that you’re getting what you’re paying for!</p>
<p>The most cost effective way to make sure your property is delivered just as your purchase contract promised, is to have your contract documentation reviewed and the property physically inspected and assessed by an appropriately qualified Building Consultant.</p>
<p>An NBtax Condition Assessment, completed by a Napier &amp; Blakeley Building Consultant will take note of the ‘as built finish’ of your property. From our initial review of purchase documentation, contract of sale, agreed finishes and specifications, we have a unique understanding of what was agreed to be built.</p>
<p>We will inspect your property on your behalf, asses and document the condition of the finishes within the property, good or bad.</p>
<p>Following an inspection a Condition Assessment will be completed by NBtax and will provide a concise summary of the condition of the property. It will list defects that the developer and or builder should address to deliver the property that is consistent with expectations, including but not always limited to, the agreed plans and specifications, good building practice and expected industry standard.</p>
<p>Our assessment will give you a clear understanding of any potential issues or defects before you take possession, move in or put the property up for lease.  It also gives you peace of mind, providing you with a document that will ensure agreed items between you, the purchaser, and the vendor are installed or rectified prior to settlement.</p>
<p>The best time to have a Condition Assessment completed is as close as possible to the planned settlement date. It is important to note that you still have a contractual obligation to settle your purchase on time. However, under normal circumstances having a condition assessment completed on your property will make you a more informed purchaser and provide you with a written report to enable you to highlight to the developers identifying items requiring attention.</p>
<p>This service is especially valuable to those offshore purchasers who are not present at the time of settlement. We are able to act on their behalf during settlement inspections to ensure relevant conditions are met within the sale contract.</p>
<p>Our specialised teams are ready to help, contact us today.</p>
<p><em>For more information, <a href="https://nbtax.com.au/" target="_blank">click here</a>.</em></p>
<p><em> </em></p>
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Be sure to get what you paid for!

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<p>SPONSORED POST</p>
<p>Australia definitely is the place to be right now. Pretty much every state and territory in Australia appears to be enjoying steady property growth.</p>
<p>The apartment market is rising and developments are selling out before they’re even built. The low density residential markets in the middle and outer suburbs too are enjoying solid growth.</p>
<p>With property doing well in Australia, you’d think it’s the perfect time to buy, but it’s proving to be probably the hardest it has ever been for first time Aussie investors to enter the market. Banks are asking for bigger deposits, interest rates are on the down turn, and first home buyer grants are only for those first time buyers that want to live in their homes. The question many of us ask is; “Is the government doing anything to help first time investors in Australia?” </p>
<p>The answer is yes, and they did it 3 decades ago. The introduction of negative gearing and the golden gem that is Property Tax Depreciation, gives investors the chance to reduce the after tax cost of their investment, increase their cash flow all while having a property asset appreciate.</p>
<p>Property Tax Depreciation can be an excellent way to make negative gearing work in your favour. Current interest rates, and a competitive rental market make it very easy for a negatively geared investment to become positive. Positive is good – except for the additional burden of a tax bill!</p>
<p>Understanding your property investment, and the cost of it before you buy is prudent, and knowing the available property tax depreciation can, if anything boost your potential buying power. That extra $10-15k of deductions can make a huge difference in the property game.</p>
<p>Knowing how property tax depreciation works is pivotal when making your first property investment, or any property investment for that matter. As property tax depreciation diminishes over time, the older the property, the less property tax depreciation there is going to be available. One might say it’s always wiser to purchase newer property – this ensures you’ll be able to claim the maximum available property tax deprecation, putting more in your pocket during the life of your investment.</p>
<p>So you’ve bought your investment? Then we come to the harder part – who do we trust? Who do we go to, to ensure we have a maximised property tax depreciation schedule?</p>
<p>In the eighties when residential property tax depreciation was introduced to the Australian taxation system, there was only one company that people turned to; <strong>Napier &amp; Blakeley.</strong></p>
<p>Napier &amp; Blakeley were the first professional company to provide residential property tax depreciation advice, and over three decades on, they’re still the market leaders and still providing that same trustworthy advice through NBtax. NBtax is a division within Napier &amp; Blakeley that concentrates purely on the residential property depreciation market.   </p>
<p>With tax time so near, if you’ve purchased an investment property in the past year, make sure you’re prepared with a property tax depreciation schedule that’s best for you.</p>
<p><em>For more information, <a href="https://nbtax.com.au" target="_blank">click here</a>.</em></p>
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Making your first property investment possible

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<p><span lang="EN-AU">Australians have forked out an estimated $47.6 billion in ‘lazy tax’ over the past 10 years by keeping their mortgage with the Big Four banks rather than switching to one of the lowest rates in the market.</span> </p>
<p class="x_MsoNormal"><span lang="EN-AU">That’s an estimated $14,215 for a borrower with the typical $300,000 mortgage, or $23,692 for borrowers with a $500,000 loan.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">Sally Tindall, money editor at <a href="https://www.ratecity.com.au/home-loans" target="_blank">RateCity.com.au</a>, said borrowers shouldn’t set and forget about their home loans.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“Australians, traditionally, haven’t been big switchers but when they do, they are saving thousands of dollars,” she said.</span> </p>
<p class="x_MsoNormal"><span lang="EN-AU">“It’s not difficult to find an interest rate starting with a three, and it’s not uncommon to find rates starting with five, so the variation between rates is huge in dollar terms.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“People need to start thinking about the rate they are paying and factoring that into their bottom line when they take out a loan.”</span></p>
<p class="x_MsoNormal"><a href="/images/2016/06/06/image002.jpg" target="_blank"><span lang="EN-AU">Click to enlarge</span></a></p>
<p class="x_MsoNormal"><span lang="EN-AU"><img src="/images/2016/06/06/image002.jpg" alt=""> </span></p>
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Switching makes dollars and sense: Ratecity

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<p class="p1">Bill Shorten and Labor are promising to perform a mathematical miracle in the real estate industry: they have a policy under which prices will keep rising but affordability will improve.</p>
<p class="p1">Labor justified its real estate taxation policy with the claimed desire to improve housing affordability. Shorten in his policy announcement essentially blamed all price rises over the past 30 years on negatively-geared investors and inferred that nobbling them would revolutionise affordability.</p>
<p class="p1">This has scared the living daylights out Australians who live in the 70 percent of households which own their homes. Labor was promising to reduce the value of their major asset.</p>
<p class="p1">Since Labor realised the fundamental flaw in its policy pitch, it has been at pains to claim that property values won’t fall under its changes. The ALP-aligned think tank, The McKell Institute, is now saying that house prices will keep rising under the Labor policy.</p>
<p class="p1">So Labor proposes to perform a statistical miracle. Prices will keep rising but affordability will improve. One wonders about the means they will use to achieve this. Other than lower prices, the only mechanisms for improving affordability are a big cut in interest rates (already at record lows and not controlled by the politicians) and/or a big rise in incomes (not part of the plan, as far as I know).</p>
<p class="p1">This confirms – yet again – that politicians collectively lack even a primary school understanding of how property markets work and how their blinkered policies impact on real estate consumers. They seem unable to think policies through to logical conclusions. They keep introducing laws which they claim will improve affordability but which make it worse – every time.</p>
<p class="p3">This is playing out at a state level, with the Governments in charge of the two biggest states slugging foreign investors with new taxes. They maintain that this will somehow make housing cheaper but sadly - yet again - it will have the opposite impact.</p>
<p class="p3">There are widely diverging views on affordability – how serious it is, what causes the problem, who’s to blame for prices rising and how to fix things. But one area where most parties tend to agree is that increasing the supply of dwellings would have a beneficial impact.</p>
<p class="p3">In fact, the best chance of bringing down prices at a local level is creation of an oversupply. As we have seen in selected locations around Australia in recent years, it’s the one major element that causes prices to drop.</p>
<p class="p3">Specific markets, notably inner-city apartment markets in some capital cities, are poised for a hefty rise in supply which is linked directly to foreign investment. If planned projects proceed, price decline is almost inevitable.</p>
<p class="p3">But state government moves in Victoria and New South Wales to lift sharply increase taxes on foreign buyers of Australia real estate are likely to prevent or limit that increase in supply.</p>
<p class="p3">Coupled with moves by the banks to curtail lending to foreign buyers and ATO measures affecting sales above $2 million, Australia has quickly cobbled together a series of major disincentives to foreign investment. There are reports of Asian investors switching their focus away from Australia to other, more welcoming nations.</p>
<p class="p3">If foreign investors stop buying (they won’t all be turned away, but many will, I suspect) many of the proposed apartment projects simply will not be built. </p>
<p class="p3">The big increase in new dwelling supply will be lost, as will many construction jobs. </p>
<p class="p3">In reality, I suspect the state measures have little to do with a desire to improve affordability. It’s essentially a cash grab, disguised as a measure to help young Australians achieve home ownership.</p>
<p class="p3">Like everything else coming out of the befuddled brains of politicians, the moves will make the problems in real estate worse.</p>
<p class="p1"><em>Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a></em></p>
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terryryder-YECXbqmri2

Cash grab or about affordability? Terry Ryder

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<p><span>GUEST OBSERVER</span></p>
<p><span>It is time for the state government to put the interests of first homebuyers at the top of its agenda.</span></p>
<p>As part of a review of its Real Tax Policy ahead of the June 10, 2016 NSW Budget, REINSW has called for the state government to make amendments to stamp duty for first homebuyers.</p>
<p><span>Home ownership is not only something that individuals should aspire to, it is also something that government should foster and encourage as a means of building wealth and providing for a persons care post employment.</span></p>
<p><span>The NSW government needs to provide first homebuyers with a 50 percent reduction in the stamp duty on a purchase of a residential property less than $1 million and provide the ability to pay the stamp duty over time. </span></p>
<p><span>Not supporting first homebuyers is to say the least short sighted and creates the risk that our best and brightest will be enticed to other states where the dream of home ownership can be a reality. </span></p>
<p><span>The existing first homebuyer incentives are focused on new dwellings. The strategy being, by focusing demand toward new properties this will correct the supply problem. </span></p>
<p><span>Unfortunately the strategy has two major short comings, firstly most first homebuyers buy existing properties as new dwellings are financially beyond their capacity. Secondly increasing demand will not solve the supply problem. </span></p>
<p><span>We refer to ourselves us the Premier State, if there is truth behind the words then providing a pathway for our first homebuyers into their own home, is a clear way to demonstrate that the words have substance,.</span></p>
<p><em>John Cunningham is president, REINSW and can be contacted <a href="https://www.reinsw.com.au/imis15_Prod/web" target="_blank">here</a>. </em></p>
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