Federal Treasurer Jim Chalmers is set to unveil refreshed economic and fiscal forecast tomorrow but what could be in store for the housing market?
Here’s what we know so far about the housing policies that will be announced tomorrow:
Expansion of the Home Guarantee Scheme
The Federal Government will be expanding the eligibility of the programs under the Home Guarantee Scheme, making it easier for more buyers to be qualified.
Starting July 2023, joint applications for friends, siblings, and other family members will be allowed under the First Home Guarantee and the Regional First Home Buyer Guarantee.
Under current rules, these programs are restricted to single applicants and people that are married or in a de‑facto relationship.
Meanwhile, non-first-home buyers who have not owned a property in Australia in the last 10 years will be eligible to apply for First Home Guarantee and the Regional First Home Buyer Guarantee. This will provide support to those who are planning to re-enter the property market.
The Family Home Guarantee will also be extended to include single legal guardians of children such as aunts, uncles, and grandparents.
Support for Build-to-Rent Projects
The Budget will be including tax breaks to encourage build-to-rent projects, including the increase of depreciation rate from 2.5% to 4% per year for projects commenced after 9 May 2023.
Furthermore, the government will also cut the withholding tax rate for eligible fund payments from managed investment trusts (MIT) attributable to residential build-to-rent projects from 30% to 15%. This will take effect starting 1 July 2024 for income attributable to newly built build-to-rent projects.
Social Housing Projects
PRD Chief Economist Dr Asti Mardiasmo said the federal government is expected to show support for social and affordable housing sector in the Budget.
“If we look at the second round of the Queensland Housing Investment Fund, yes social and affordable housing is prioritised, however you must already have an acquired private land site or a proposed asset to purchase and then re-purpose," she said in a report for Savings.com.au.
