Daily Buzz: Tuesday, 12 December

PropertyBuzz, your daily dose of property news.

Foreign investor fees are set to increase, and rising payments push mortgage holders to the brink, and how Victoria plans to transition away from commercial stamp duty.

Welcome to Property Buzz! I’m Orana Durney-Benson. Today is Tuesday, 12 December.

– Australia is increasing federal fees for foreign property investors to discourage homes being left vacant and increase housing availability for residents.

– The new framework includes higher fees for purchasing existing homes and increased penalties for dwellings being left vacant. In some instances, the vacant property fee could increase by as much as six fold.

– At the same time, application fees for foreign investment in build-to-rent projects are set to be reduced to encourage more new home construction.

– The changes aim to push foreign investors towards new housing developments and encourage the development of rental properties.

– And according to the Real Estate Institute of Australia’s Housing Affordability Report, the average Australian home loan repayment now requires 45 per cent of household income.

– Housing affordability declined in NSW, Queensland and South Australia, with the largest decline in South Australia. However, affordability improved in Victoria, Western Australia, Tasmania and the Northern Territory.

– The number of new first home buyers dropped 5.4 per cent over the September quarter, with the average loan size to first home buyers increasing to roughly $500,000, a 0.9 per cent increase over the quarter.

– Rental affordability also declined, with the proportion of income required to meet median rent increasing by 0.5 percentage points to 23.6 per cent. This decline was seen in NSW, Victoria, Queensland and South Australia.

– Victoria is planning to replace stamp duty on commercial and industrial properties with a new property tax, aiming to stimulate business investment and job creation.

– The change was first announced in the 2023-24 state budget, with plans just released following a broad consultation process.

– The new tax will be set at a flat rate of 1 per cent of a property’s unimproved land value, with the transition starting from 1 July 2024. Stamp duty will still be payable on one last transaction of any commercial and industrial property in the state, with an annual tax to come into play 10 years after the last time stamp duty was paid on a property.

That’s Property Buzz for today. 

See you again tomorrow, 13 December, for your daily dose of Property Buzz.

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