The Urban Development Institute of Australia (UDIA WA) has welcomed the Premier’s focus on housing and land supply in today’s WA State Budget given the housing supply crisis that is being experienced across the state.
Measures to facilitate Build-to-Rent product, the expansion of the Off-the-Plan Duty Rebate Scheme and new Keystart loan products are all reflective of UDIA WA’s State Budget recommendations that were published earlier this year.
“UDIA WA’s submission focused on creating capacity and boosting much needed housing supply to ensure we can attract the skilled workers we desperately need,” UDIA WA CEO Tanya Steinbeck said.
“This budget has several elements that will address these issues,” Ms Steinbeck said.
While welcoming the measures, Ms Steinbeck warned that these should only be considered initial measures and more needs to be done if we are going to ensure that Perth and WA remains one of the most affordable places to live in Australia.
“We want to attract skilled migrants to our shores and in order to do that, we need to have somewhere for them to live,” Ms Steinbeck said.
“Many people that we want to attract here will have families and need somewhere that is affordable and appropriate for their needs,” Ms Steinbeck said.
Build to Rent
“One of our top recommendations was the need to encourage investment in the Build-to-Rent (BTR) sector in order to boost rental supply,” Ms Steinbeck said.
The Budget has earmarked a 50% land tax exemption for new, eligible BTR developments that will commence on 1 July 2023.
“While the details are still to be finalized, on the face of it, this is a very welcome move,” Ms Steinbeck said.
“This is a similar incentive to what has been applied in other states and we know that the Build-to-Rent model can play a significant role in delivering greater housing choice to the market” Ms Steinbeck said.
“We also hope the Federal Government will come to the party as we lead into the upcoming election, by amending MIT and GST settings to further support Build-to-Rent projects that assist with urgently need rental supply,” Ms Steinbeck said.
Off the Plan Duty Rebate Scheme
The new 100 per cent Off the Plan (OTP) transfer duty rebate on properties valued under $500,000 has also been welcomed by the Institute.
“The Transfer Duty Rebate Scheme has proven an important tool in supporting the apartment market over the last couple of years,” Ms Steinbeck said.
“While we would have liked to see the timeframes for this rebate scheme extended beyond 2023, this new measure is sure to increase the appetite for more affordable product in the medium and higher density space,” Ms Steinbeck said.
“one of the biggest issues, especially in light of material cost escalations and severe skills shortages, is making projects that deliver more affordable product, stack up financially,” Ms Steinbeck said.
“We will continue to work with the State Government on this issue because we believe there is more that can be done in relation to the scheme to facilitate more affordable built form product to the market,” Ms Steinbeck said. “Particularly in relation to the timeframes around the availability of the scheme.”
Keystart for infill and METRONET sites
While details are thin in the budget papers, the new Keystart loan product aimed at encouraging home buyers to purchase in infill and METRONET precincts could be a useful tool to progress the State Government’s infill agenda and facilitate more people into their own home, according to Ms Steinbeck.
“While it was not detailed in the budget papers, our understanding is that this new Keystart loan product will be made available for a two-year trial,” Ms Steinbeck said.
Capped at 300 loans, the eligible property values will be slightly higher than the standard Keystart limits, with the price cap at $650,000 for couples and $550,000 for singles. Income limits are also slightly higher.
“These increased limits are reflective of the higher value property in these locations and will hopefully facilitate Keystart customers to consider a broader diversity of housing product and allow them to live in areas in closer proximity to the CBD or other activity centres,” Ms Steinbeck said.
“Facilitating people to live in a range of areas is critical to ensuring that different households lifestyle needs are met,” Ms Steinbeck said.
UDIA WA also welcomed the permanent increases to Keystart income eligibility limits.
Conclusion
“Overall, the Premier and the State Government must be congratulated for delivering a State Budget that not only reflects WA’s outstanding economic growth, but acknowledges the need to address people’s costs of living expenses and need to facilitate affordable housing,” Ms Steinbeck said.
“This budget includes several measures that are a step in the right direction in terms of getting more supply on the ground,” Ms Steinbeck said.
“We know there is more that can be done but we are pleased to see that the government is taking our concerns on board and making moves to address them,’ Ms Steinbeck said.
End.
Contact:
Gemma Osiejak
Executive Manager Communications & Marketing
P: 0421 506 819
E: gosiejak@udiawa.com.au