This new Federal Government initiative will prove a boon to residential property investors and low income renters alike.
The scheme provides for a tax free rebate of $8,000 per dwelling per year for up to 10 years for new rental accommodation of 20% below market rent for the particular area. The net effect will be between $5,000 and $6,000 per annum tax free per dwelling on top of normal net income.
Developers need to obtain accreditation for each development of more than 20 dwellings. Round 2 accreditations close on 27 March 2009.
It is anticipated that the scheme will kick-start the residential property investment market, which has been in the doldrums since 2003 when sharply escalating house prices reduced rental yields, even though rents were rising during that time.
Thursday, December 18, 2008
Tuesday, December 9, 2008
Residential Property Lending Will Drive the Recovery in QLD
Why?
1. The residential property market generates more economic and employment multipliers than any other industry, e.g. furniture, white goods, landscaping, floor coverings, and most of all the trades (carpentry, plumbing, electrical, bricklaying, roof fixing and finance/banking).
2. Banks who are currently restricting lending on property will inevitably return to the mortgage market because this is the lowest risk and most profitable form of lending (lending margins are currently 3%). Capital required for lending will come from share issues and increasing retail deposits emanating from the Government deposit guarantee.
3. Record population growth should continue underpinning housing demand.
When?
The return to normal mortgage lending levels and development funding will take up to 18 months. This is the time it should take for the banks to re-capitalise their losses and maintain their capital adequacy ratios without the need to cut lending.
1. The residential property market generates more economic and employment multipliers than any other industry, e.g. furniture, white goods, landscaping, floor coverings, and most of all the trades (carpentry, plumbing, electrical, bricklaying, roof fixing and finance/banking).
2. Banks who are currently restricting lending on property will inevitably return to the mortgage market because this is the lowest risk and most profitable form of lending (lending margins are currently 3%). Capital required for lending will come from share issues and increasing retail deposits emanating from the Government deposit guarantee.
3. Record population growth should continue underpinning housing demand.
When?
The return to normal mortgage lending levels and development funding will take up to 18 months. This is the time it should take for the banks to re-capitalise their losses and maintain their capital adequacy ratios without the need to cut lending.
Tuesday, December 2, 2008
Property in 2009 Seminar
Thank you to all those who attended the Midwood Australia seminar on Tuesday night, 2nd December. If you would like a copy of the presentation please copy and paste the link below into your browser.
http://www.midwoodaustralia.com/files/Midwood-Seminar-Dec-08-Property-in-2009.pdf
If you have any feedback from the night, please feel free to post your comments.
Regards,
Bill.
http://www.midwoodaustralia.com/files/Midwood-Seminar-Dec-08-Property-in-2009.pdf
If you have any feedback from the night, please feel free to post your comments.
Regards,
Bill.
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