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The Federal Budget 2017: What it Means for Property
The much-anticipated Federal Budget of 2017-2018 strongly focuses on implementing policies to advance the current status of housing affordability in Australia. For homeowners, investors, and developers alike, this in fact will open up doors for first home buyers and professionals in the industry.
“The signs of an improving global economy are there to see. There is clearly the potential for better days ahead.” Assured by Honourable Scott Morrison MP, Treasurer of the Commonwealth of Australia, fairness, security, and opportunity are at the forefront of the policy.
The Federal Budget saw the establishment of a new scheme, the First Home Super Savers Scheme. This Scheme was initiated to provide opportunities to this group of individuals by allowing the option to voluntarily withdraw superannuation contributions from the commencement of the new financial year, 1st July 2017. This withdrawal amount can then be used towards a first home deposit. In addition, these first homebuyers will have the option to salary sacrifice for this deposit.
To strengthen the advantage of local buyers to purchase Australian real estate, the Budget also saw the introduction of a levy for investors who leave their property vacant for at least six months per year. To ensure that property investors are capitalizing on Australian investments, this levy aims to safeguard that these properties are purchased for the sole purpose of occupation- either by themselves, or local lessees. Known as a “ghost tax” this levy can reach up to $5,000 per annum for owners who leave their properties unoccupied.
For Australian residents aged over 65, an estimated $65,000 in proceeds of sale of their property can be put back into their superannuation funds. Provided these individuals have owner their properties for over ten years, the motive of this scheme is to allocate larger homes for families to move into. With growing popularity of apartments, this comes at a great time for developers supplying this demand; and those over the age bracket utilising the advantages of apartment living.
Stronger Growth for Australians
With certain debatable policies in the Federal Budget 2017-2018 such as factors affecting tax rates and negative gearing, the overall objective was building a stronger Australian economy. This can be seen through policies aimed at delivering greater infrastructure, creating more jobs and providing more fruitful (and affordable) investment opportunities. Greater government expenditure in infrastructure such as Badgerys’ Creek Airport is but one way to expand these opportunities and create employment in areas throughout Western Sydney.