The new Budget and Property

The government threw almost everything at the ‘housing affordability crisis’ on Tuesday night. Here’s how it affects you;



First Home Super Saver Scheme.

This scheme would instead let them save explicitly into super for a property deposit– with similar tax perks.

Aspiring property owners would pay not their marginal rate but just the 15 per cent super contribution tax. They would be able to save $30,000 or $15,000 a year – each – so a couple can amass double (note this is subject to the overall annual concessional contributions limit, which includes the 9.5 per cent employers pay, of $25,000 a year).

This money will grow at the 90-day bank bill rate plus 3 per cent, which is a nice boost on what you can get in a traditional savings account. On withdrawal, this money will be taxed at the relevant marginal rate minus 30 per cent.

Here’s a great calculator which shows exactly how much more of a deposit you can save by taking advantage of this scheme –



So it’s with some relief to investors, often blamed for the rises, that largely they have been spared from a crackdown. Negative gearing stays with some small tweaks (you can forget the “inspection” trip to the Gold Coast and kiss goodbye to some depreciation items unless you actually bought them). Capital gains tax (CGT) concessions too are safe.

But it’s a different story for overseas investors, where there’s a deliberate campaign to cull.

·         The main residence exemption from CGT will disappear entirely for non- or temporary residents – effective immediately (although they can claim the exemption on existing properties until June 30, 2019).

·         Foreign ownership in new developments will be restricted to 50 per cent.

To boost the availability of rental accommodation, future foreign owners will also incur a $5000 “ghost tax” if they leave a property vacant for six or more months in a year. Meanwhile, local investors who offer cheaper rents to tenants on low to moderate incomes could qualify for extra CGT concessions, from 50 to 60 per cent (a registered community housing provider must manage the property for at least three years).



The Budget also encourages senior Australians over 65 to down size by making a non-concessional contribution of up to $300,000 into their superannuation fund from the proceeds of the sale of their principal home.

“While we’re pleased the Turnbull Government have recognised the need to assist Australian seniors with housing affordability, more still needs to be done. REIWA will continue to advocate for reform to transfer duty, specifically a $10,000 concession for seniors to ‘right size’,” REIWA President, Mr Groves said.


Whether you’re a first home buyer, investor or upsizing or downsizing, feel free to contact me at anytime for all manner of real estate advice, obligation free.

Wayne Heldt.

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