Many investors and homeowners will have kept a keen eye on the recent Federal Budget to see if it will ease some of the challenges caused by 12 months of interest rate rises implemented to tame inflation.
This snapshot looks at the Budget’s leading programs aimed at encouraging investors, helping first-time buyers and committing to social housing.
- Eligibility for the First Home Guarantee and Regional First Home Guarantee has been expanded. It will now include any two borrowers beyond married and de facto couples, meaning friends can buy together and benefit from this policy.
- Staying with the above guarantee, non‑first-home buyers who have not owned a property in the past 10 years can also use the policy but must have Permanent Residency.
- Commonwealth Rental Assistance will be increased by 15 per cent at a cost of $2.7 billion over five years.
- A promise to build one million homes starting next year through the National Housing Accord.
- Withholding tax will be reduced from 30% to 15% for eligible fund payments from managed investment trusts. However, these must be linked to newly-constructed and build‑to‑rent developments.
- There’s an increase in the annual depreciation rate (also known as capital works tax deduction) from 2.5% to 4% for new build‑to‑rent developments.
- The National Housing Finance and Investment Corporation’s liability cap will be raised to $7.5 billion, which represents a hike of $2 billion. These funds are designed to support social and affordable housing projects.
- A $159.7 million urban Precincts and Partnerships Program promises to improve cities and suburbs.
- Some $211.7 million has been allocated to the Thriving Suburbs Program to enhance community and economic infrastructure.