Quick Guide to the ATO’s One Stop Property Webpage
The Australian Tax Office (‘ATO’) recently launched a one stop property webpage specifically designed for home owners and investment property owners. The site covers a rate of tax issues. It is an excellent resource for beginners and experienced investors alike who are seeking to refresh their knowledge of key property tax issues.
Introductory Section
The introductory section sets out the key issues for home owners and investors, with an overview section that covers different types of properties, uses, and investment or development activities.
For example, the ‘Your home’ section consists of the tax issues at each step from saving for your first home; buying and selling your home; buying a second property; to renting, building, or renovating your home. This section also contains an overview of home offices.
Sydney Leading on Construction and Housing
Sydney has seen strong growth in construction and housing with a plethora of major construction and infrastructure projects currently under track. Furthermore, the city has recorded some of the strongest housing prices in the nation. The latest figures indicate that Sydney’s leading role in the national housing market is set to continue, making it a strong for destination for investment property.
Housing Capital Growth
The latest Australian Property Monitors data indicates that apartment prices were unchanged in Sydney even as the rest of the nation saw some small adjustments in price. The affordability of apartments coupled with a general trend towards small households and higher density living has driven Sydney’s strong performance
Apartment quick facts:
Adelaide’s CBD Developments to Watch
Consistently ranked in the top ten for liveability surveys, Adelaide is a favoured destination for investment property, both in Australia and within South Australia itself. Recent private development projects and government initiatives have further raised its profile as an investment destination to watch. Most recently, draft masterplans have been released for Rundle Mall and the riverbank precinct.
Rundle Mall Development
Rundle Mall is the most visited site in Adelaide with 24 million visitors every year. Long considered to be the premiere retail area in South Australia, the Mall is currently undergoing development for a multi-storey $385 million retail complex named ‘Rundle Place’.
National Rental Affordability Scheme to Benefit Renters
In October, the federal government announced the outcome of the latest round of the National Rental Affordability Scheme (‘NRAS’). The NRAS is aimed at delivering affordable rental housing to low and moderate income earners over the course of a decade. In this article, we look at the NRAS and its implications for renters and investors.
At a Glance: The National Rental Affordability Scheme
The NRAS began running in 2008, when the federal government incorporated it as a major component in its $3.7 billion housing package. The main goal of the scheme is to boost rental housing stocks for low to medium income earners. In order to deliver this goal, the State and Federal governments have incentivized investors to rent out approved new properties at a discounted rent by offering them a Tax-Free payment each year for 10 years. This property investment option is suitable for many investors in relation to many approved properties all around Australia.
Under the NRAS scheme:
Investors See a Big Future in Apartments
Apartments are one of the most attractive options for price sensitive investors looking for investment property with potential for high yields and capital growth. Affordability, location, attractiveness to tenants – these are just some of the reasons for the growing popularity of apartments.
Prices
One of the key advantages of purchasing an apartment over a house is the price differential.
- Across Australia’s capital cities there is a 13.3 per cent (or $56,000) difference between median house price and median unit price.
- The difference is the highest in Canberra, where the median price for a house is $129,000 higher than that for a unit. In Sydney, the difference is $103,000. Sydney and Canberra are the Australian cities with the highest unit sales relative to sales for all other dwelling types (around 43 per cent for both cities).
- In Melbourne, Brisbane, Perth, and Adelaide, the differential is at around 18 per cent, much lower than Sydney or Canberra, but still a significant difference amounting to around $70,000.
Australian Investors Turning to Interstate Properties
A recent report has revealed that a growing number of Australian investors are looking beyond their home state or territory when choosing investment property. In this article, we examine the trend toward interstate investment and its potential advantages for investors.
Investors Favouring Queensland Properties
According to a report by Terri Scheer Insurance, around one-fifth of its insured landlords own investment property outside their state or territory of residence. The report found that:
Perth Rents Soar as Vacancy Rates Plummet
Australia’s fourth most populous city is experiencing stunning growth in its rental market, making it a more promising prospect for investment property than ever. The latest figures on Perth’s rental activity reveals that rents are soaring and new supply is being rapidly outpaced by growth in demand.
New Supply Being Outpaced by Demand Growth
Figures released by the Real Estate Institute of Western Australia (‘REIWA’) for the September quarter have shown that new rental leases increased by 6 per cent in the three months to September.
Although new housing stock was released into the rental market rather than being sold, this additional stock was quickly absorbed by strong rental demand, with the number of properties available for lease falling by 20 per cent or from 3,600 to 2,800.
Young Investors Reaping Property Rewards
A well-considered investment property can double in value in as little as 10 years. With the old adage ‘time is on your side’ in mind, Australia’s enthusiastic young investors are getting into the property market early and reaping significant gains.
Key Motivations to Buy
Younger investors are getting started as early as 18 or younger, or as soon as they’re able to work. According to a 2011 survey by Mortgage Choice, setting up oneself financially is one of the top motivators for younger investors.
Other reasons included not being ready to own their first home, wanting to get a head start in the market, and not yet being able to afford to purchase their dream home. The same survey found that 77 per cent of Generation Ys were already making lifestyle sacrifices to achieve their property goals.
Sydney’s Inner-City Star Performers
Some of Sydney’s top performers in the apartment category have been those in the mid-range, situated in the lower North Shore and the city-east areas. Various inner-city locales have yielded great capital growth, which bodes very well for investors looking for inner-city investment property.
North Shore
Sydney’s North Shore is the primary residential area of northern metropolitan Sydney. Some of its suburbs, such as McMahons Point, Waverton, Hunters Hill, and North Sydney, have show excellent growth for mid-range properties below the $600,000 price mark.
Growth has been estimated to have been as much as 10 per cent in the past year for the area. Given their excellent rental returns, one-bedroom and studio units and apartments have proven to be the most popular, particularly for property investment.
Quick facts:
Smaller, Smarter, and Greener Dwellings for Australians
The trend for new houses and apartments in recent years has been toward buildling dwellings that are smaller, smarter, and greener. While a recent report by the Australian Property Institute found that green star commercial buildings deliver a 5 per cent premium in rent, the green trend is also catching in the residential market. Both first-time home buyers and investors seeking residential investment property are opting for compact living spaces. We examine what these smaller dwellings look like below.
1. Multi-Feature Rooms
It’s been estimated that removing household clutter can yield extra space equivalent to a bedroom or study, and incorporating clever design strategies can enhance space efficiency. Furthermore, well-designed homes can reduce construction costs by incorporating these multi-feature rooms.
