New incentives have been announced to encourage more investors to build rental properties in Victoria.
A statement from state Treasurer Tim Pallas has revealed that eligible build‑to‑rent developments completed and operational between 1 January 2021 and 31 December 2031 will receive both the 50 per cent land tax discount and full exemption from the Absentee Owner Surcharge (AOS) for up to 30 years from 1 January 2022.
The original scheme was intended to end in 2040, but the new support boost “will now provide the certainty of a full 30-year concession to projects starting before 2032”.
The 50 per cent land tax discount from 1 January 2022 for eligible developments was first flagged in the Victorian budget 2020-21, with the Victorian government encouraging more investment in the expanding sector – having identified the build-to-rent sector as “a new approach to residential housing”.
“The sector presents an opportunity to increase rental supply, improve the diversity of housing choice and mix, and provide more long‑term rental options,” the Treasurer flagged.
The expansion of the scheme aims to provide more certainty for eligible developments and give confidence to shovel-ready projects so that work commences as soon as possible.
According to Minister Pallas, “this will not only ensure Victorians have access to more rental homes and a greater range of housing options – it will create thousands of jobs as we rebuild from the coronavirus pandemic”.
The latest announcement comes after the launch of a $500 million home buyer fund last week, which will see eligible Victorians able to purchase a home with a deposit of as little as 3.5 per cent, with the state government taking an equity share in return.
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Grace is a journalist across Momentum property and investment brands. Grace joined Momentum Media in 2018, bringing with her a Bachelor of Laws and a Bachelor of Communication (Journalism) from the University of Newcastle. She’s passionate about delivering easy to digest information and content relevant to her key audiences and stakeholders.