March 2019 Newsletter

REINSW LAUNCHES ELECTION 2019 CAMPAIGN

Making better decisions for the property services industry and NSW homebuyers are the key components of the Real Estate Institute of NSW’s Election 2019 campaign.

As part of its campaign, the REINSW is lobbying the NSW government regarding:

  • the need for a Commissioner for Property Services and moving the property services industry out from NSW Fair Trading property taxation reform, prioritising stamp duty.

According to the REINSW, these changes are critical to ensuring the continued prosperity of the property services industry. In particular, the REINSW believes stamp duty requires urgent reform. It wants the NSW government to revise stamp duty tiers so they align with the current price of property and to immediately remove stamp duty charges on GST and other government taxes. It also wants the government to offer stamp duty relief to those over 65 who want to downsize.

The REINSW is now calling on its members, the wider industry and the general public to sign a petition it has set up to encourage the NSW government to prioritise stamp duty reform.

REINSW CEO Tim McKibbin says that property impacts everyone and everyone needs a roof over their head. “It’s a basic necessity of life,” he said. “For a government to significantly impede its citizens’ efforts to achieve this is simply appalling.”

The NSW government raised $8.4 billion from stamp duty revenue in the 2017-18 financial year.

McKibbin adds very few homebuyers are benefiting from the NSW government’s recent stamp duty initiatives. He says the government provides stamp duty relief on properties with a sale price of up to $650,000 and a sliding scale of relief that diminishes proportionally between $650,000  and $850,000.

“The median house price in Sydney is $985,000 and the median unit price is $717,000,” he says. “At these prices, already very few Sydney homebuyers are benefitting from the government’s initiatives.”

Meanwhile, McKibbin says the change from July 1, 2019 to move the seven stamp duty tax brackets in line with the consumer price index, is all political hype and of no tangible benefit.

UDIA CRITICISES LABOR’S NEGATIVE GEARING PROPOSAL

The UDIA has criticised Labor’s proposal to curb negative gearing and increase capital gains tax stating it could reduce investment in the housing market and exacerbate the effects of the market downturn.

UDIA national president Darren Cooper says any proposal to restrict negative gearing to new homes will severely limit the diversity of price, location, size and quality of Australia’s rental housing stock well into the future.

“As such, it is critical capital gains and negative gearing settings are maintained as they are, at least until the potential impacts of any proposed changes are fully understood,” he says.

The UDIA is concerned the changes could have a permanent structural impact on markets, with the greatest effect being on recovering markets such as Western Australia. It believes without private investment, there will be a significant shortfall of rental housing and investors will be chasing higher returns, putting upward pressure on renters.

“In order to reduce the housing affordability crisis, the government should support the states and territories with tax reform that focuses on the unsustainable levels of government tax on new properties,” Cooper says.

It’s not just the UDIA criticising Labor’s policy around negative gearing. The Real Estate Institute of Australia (REIA) wants Labor to “come clean” on its policy rather than saying there will be no changes to its policy until after the election.

REIA president Adrian Kelly says the announcement around there being no changes until after the election is because “the ALP doesn’t want any voter backlash in the lead up to the election”.

He says all Australians need to know what and when a Labor government, if elected, will do regarding property taxation. “It is not acceptable to be having a couple of bob each way in the lead up to the election,” he says.

NEW LAWS AROUND COMBUSTIBLE CLADDING

Owners of certain buildings with combustible cladding should now have registered their building with the NSW government.

The Environmental Planning and Assessment Amendment (Identification of Buildings with External Combustible Cladding) Regulation 2018 (NSW) (Amendment Regulation) came into effect on October 22, 2018. It requires that owners of affected residential and public buildings occupied before October 22, 2018 to be registered through the NSW Cladding Registration portal by February 22, 2019.

New buildings need to be registered within four months of the building first being occupied.

The regulation applies to certain buildings of two or more storeys including residential apartment blocks, aged-care buildings, hospitals and day surgeries, boarding houses and student accommodation.

Since July 2017, the NSW Cladding Taskforce has been advancing the identification and inspection of buildings with combustible cladding, and registration helps agencies such as Fire & Rescue NSW to plan and respond in the event of a fire.

 

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March 2019 Newsletter