Victorian government moves its focus to property investors
The Victorian government has announced more new housing policies, this time focusing on investors.
Following the announcement of changes to the first home owners grant and stamp duty exemptions available to first home buyers, the Victorian government has set its sights on property investors, with two new policies to take effect from 1 January 2018 that will make property investment more expensive.
After scrapping stamp duty for first home buyers who purchase a home valued up to $600,000, the Victorian government has chosen to also remove off-the-plan stamp duty concessions for investors, according to Business Insider. These concessions will now only be available to buyers set to move into the property or those eligible for the first home owners grant.
Another change, reported by Business Insider, will come in the form of a vacant residential property tax, which will be applied to properties left vacant for more than six months of the year. The tax will be calculated at 1% of the increased value of the property in a calendar year, with a focus on inner-city and middle suburbs of Melbourne.
“With negative gearing and capital gains tax concessions, the odds are already stacked against first home buyers. This will help level the playing field,” Victorian premier Daniel Andrews told Business Insider.
Properties that are used as holiday homes, deceased estates and city units used for work and owned by Victorian residents who are temporarily overseas are exempt from the tax.
Victorian treasurer Tim Pallas told ABC Radio 774 on Monday, “I hope I don’t raise a cent out of it.” Instead, he would prefer that owners made their properties available to renters or buyers. Despite this, the tax is expected to raise approximately $80 million over the next four years, according to Business Insider.