
Most read
Pros and cons: Working in the gig economy...
Pros and cons: Working in the gig economy...

Latest Podcast
Is the market overheating; should ETFs take your fancy, and what’s happening t...
Is the market overheating; should ETFs take your fancy, and what’s happening t...

Resources
There is $17.5 billion in lost and unclaimed super across ...
There is $17.5 billion in lost and unclaimed super across ...
Invest
Budget winners: First-time buyers and granny flat builders
With so much of the budget emphasising jobs, there wasn’t much room for the federal government to embark on a big property spending spree – but that’s not to say certain sectors won’t still benefit from tax reform or funding propositions.

Budget winners: First-time buyers and granny flat builders
With so much of the budget emphasising jobs, there wasn’t much room for the federal government to embark on a big property spending spree – but that’s not to say certain sectors won’t still benefit from tax reform or funding propositions.

Here are some of the property-related takeaways from the latest allocation of federal government spending:
For first home buyers
As previously reported by nestegg, more first home buyers are set to benefit from 5 per cent home loan deposits.
The scheme was first implemented in response to a Morrison government election promise – but with more than half of the 10,000 allocated places for the 2020-21 financial year being snapped up in the first three months alone, it was clear the scheme is a popular one with first home buyers.
The First Home Loan Deposit Scheme (FHLDS) allows eligible applicants to purchase a home (within certain price restrictions based on location) with a deposit of just 5 per cent, without paying lender’s mortgage insurance.
The opening up of 10,000 new places in the scheme does have a tighter set of requirements than the initial scheme, being restricted to the building of a new home or purchase of a newly built home.
Mr Frydenberg said the additional guarantees will be available until 30 June 2021 “and will drive more construction and support jobs as part of our economic recovery plan”.
For affordable housing
The federal government has also indicated that it will be extending its guarantee for the National Housing Finance and Investment Corporation (NHFIC) by a further $1 billion in low-cost finance, which will go towards the construction of more affordable housing for those who need it – boosting jobs, construction and access to housing.
A further $150 million will be put towards the Indigenous Home Ownership Program, which will see the construction of new homes in regional areas and the creation of more jobs while helping “hundreds of indigenous families buy their own home”, Mr Frydenberg said.
For granny flat tax breaks
Although providing an “unquantifiable impact on receipts over the forward estimates period”, the budget has also outlined the provision of a targeted capital gains tax (CGT) exemption for granny flat arrangements – where there is a formal written agreement.
According to the Treasury, this exemption will apply to arrangements with older Australians or individuals with a disability, with the measure to take effect from the first income year after the date of Royal Assent of the enabling legislation.
The government outlined that CGT consequences are currently an impediment to the creation of formal and legally enforceable granny flat arrangements.
“When faced with a potentially significant CGT liability, families often opt for informal arrangements, which can lead to financial abuse and exploitation in the event that the family relationship breaks down.”
It is hoped the measure will reduce the risk of abuse to vulnerable Australians, and is consistent with recommendations from the Board of Taxation’s Review of Granny Flat Arrangements, the government’s National Plan to Respond to the Abuse of Older Australians, and the 2017 Australian Law Reform Commission’s Report: Elder Abuse – A National Legal Response.
About the author

About the author


Property
New home sales continue to soar in March
A strong level of building activity is expected in 2021 and 2022, given a strong spike in home sales during the year to March. ...Read more

Property
HomeBuilder extension announced
One of the government’s most successful schemes, HomeBuilder, has been extended, bringing the total level of expected government support for the construction sector to $2.5 billion. ...Read more

Property
Policy failures see houses become unattainable for young Australians, minister says
Australia’s booming house prices are the result of the government’s failed policies, with the younger generation now unable to afford what their parents could, a minister has said. ...Read more

Property
House prices to grow by 25% over 3 years
New research is predicting a large gain in property prices of around 25 per cent through to the end of 2023, driven mainly by low interest rates. ...Read more

Property
Strict cap on short-term rentals delayed following criticism
Following widespread criticism from councils and online rental companies, the introduction of NSW’s planned holiday rental code of conduct has been pushed back by three months. ...Read more

Property
Melbourne becomes Australia’s 2nd most affordable rental market
While most capital cities saw house rents soar to new record highs over the first quarter of 2021, Melbourne continued to lag behind – becoming the second most affordable capital city to rent in Aus...Read more

Property
Why home buyers are now more open to high-priced properties
Buyers are more likely to spend more to secure a property as their preferences shift towards bigger spaces with higher price tags, recent data has shown. ...Read more

Property
Government brushes aside RBA’s debt blowout warning
The government said it is not concerned about the RBA’s warning that the financial system could be rocked if there’s a debt blowout, in fact it is “very pleased” that confidence levels are lea...Read more

Is the market overheating; should ETFs take your fancy, and what’s happening to the low and middle income tax offset?
Listen now

Home values up 30% (or are they); NFTs taking the world by storm, and why Keating thinks Aussies will be ‘poor’ in retirement
Listen now

Raging floods, the tech stock bubble and the ongoing SG debate
Listen now

Meet the Manager with Trilogy’s Philip Ryan: RBA rates and property price growth
Listen now

Property
New home sales continue to soar in March
A strong level of building activity is expected in 2021 and 2022, given a strong spike in home sales during the year to March. ...Read more

Property
HomeBuilder extension announced
One of the government’s most successful schemes, HomeBuilder, has been extended, bringing the total level of expected government support for the construction sector to $2.5 billion. ...Read more

Property
Policy failures see houses become unattainable for young Australians, minister says
Australia’s booming house prices are the result of the government’s failed policies, with the younger generation now unable to afford what their parents could, a minister has said. ...Read more

Property
House prices to grow by 25% over 3 years
New research is predicting a large gain in property prices of around 25 per cent through to the end of 2023, driven mainly by low interest rates. ...Read more

Property
Strict cap on short-term rentals delayed following criticism
Following widespread criticism from councils and online rental companies, the introduction of NSW’s planned holiday rental code of conduct has been pushed back by three months. ...Read more

Property
Melbourne becomes Australia’s 2nd most affordable rental market
While most capital cities saw house rents soar to new record highs over the first quarter of 2021, Melbourne continued to lag behind – becoming the second most affordable capital city to rent in Aus...Read more

Property
Why home buyers are now more open to high-priced properties
Buyers are more likely to spend more to secure a property as their preferences shift towards bigger spaces with higher price tags, recent data has shown. ...Read more

Property
Government brushes aside RBA’s debt blowout warning
The government said it is not concerned about the RBA’s warning that the financial system could be rocked if there’s a debt blowout, in fact it is “very pleased” that confidence levels are lea...Read more