“We have a plan to create jobs, rebuild our economy and secure Australia’s future,” says Prime Minister Scott Morrison only hours outside of announcing the 2020/21 Federal Budget for the nation.
As it’s all anyone’s talking about amongst the continuing angst generated by the looming coronavirus, the federal budget plans proposed a strong sense of support to the real estate sector, as our national housing supply and the state of our economy are intricately linked to the success of the property sector.
There has been an immense amount of speculation around what the policies will mean for the various sectors, with many experts eager to lend their opinions to the masses. What left these experts quite delighted, and rather most of the country for that matter, was the most-welcomed announcement of income tax cuts, providing households with more money in their back pockets to spend on everyday expenses, further supporting retailers down the line.
These cuts will further help support mortgage holders, assist those who are saving for a deposit and help those looking to upgrade or purchase another property bu increasing their borrowing capacity.
The decision for taxes related to investment properties to remain unchanged complimented the tax cut advice, as investors will continue to see the benefits of the unhindered benefits of negatively gearing investment properties. The Real Estate Institute of Australia (REIA) applauded the government on its forward-thinking move.
Other welcomed declarations included the aid to job creation and infrastructural support. With a focus on creating jobs around the country in an abundance of key sectors, this measure can help to assist rental markets get back on the feet after an unsettling period of uncertainty, and help reduce the likelihood of major forced sales (mortgagee in possession sales).
A couple of the great things that were brought to the table in the year that was included the HomeBuilder Program and First Home Buyer Deposit Scheme. In terms of specific property related initiatives, HomeBuilder was a major piece of the Government’s puzzle for COVID relief. While there was no evidence released to suggest that the program will be expanded, there’s no denying immense support it brung in encouraging housing purchases to both keep jobs and industries alive.
On the other hand, the First Home Buyer Deposit Scheme is something that the Government will be expanding. As it currently stands, this scheme is available to 10,000 first home buyers, and it’s now expected that an additional 10,000 places will be added to increase its availability to fresh buyers in the market. This will also increase the limits on purchase prices from $750,000 to $950,000.
As the nation continues to battle the grip of the coronavirus’ chokehold on both Australia’s health and economy, the 2020/21 Federal Budget announcement brought forth a breath of fresh air to property owners and purchasers. If you’d like to learn more about what was announced, you can read the full report here.
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Article by Joe La Spina