It’s that time of year again! The ACT government has handed down their 2018-2019 budget, and Canberrans are now tasked with decoding it to understand what it means for them and their families.
Chief Minister and Treasurer, Andrew Barr, was pleased to announce the ACT Government had delivered on their promise to return the budget to balance, claiming this year’s budget was focused on growing services and infrastructure to make sure Canberra is a city that keeps getting better for everyone who lives here.
This year there weren’t many unexpected surprises with housing, education, health and transport being the big-ticket items. Below are our key takeaways from this year’s budget and its potential impact for Canberra buyers and home owners.
First Home Buyers
In an expected move, the government has removed the first home owners grant of $7,000 and will abolish stamp duty for first home buyers from July 2019. This announcement comes after Chief Minister, Andrew Barr, called for stamp duty tax to be abolished for all first home buyers nationwide back in February.
Under the new scheme, first home buyers with an annual household income of less than $160,000 will no longer be required to pay stamp duty on a new or established property. This is a welcome move for first home buyers who under the current scheme, have been limited to purchasing new or heavily renovated properties to qualify for the concession.
According to Domain data chief scientist, Nicolla Powell, with these changes first home buyers will be provided more options when purchasing their first home.
“Abolishing stamp duty for established homes certainly evens the choice in the market for first home buyers. What it does is opens up a number of suburbs that previously weren’t eligible for the concessions currently in place.”
We can expect to see more buyers entering the established property market, driving more competition and demand for established properties.
Canberra property owners will see an increase in their rates in the coming year. Detached home owners will pay on average a 7% increase per annum, while unit owners will face a rise of 10%, an average increase of $135.00.
Unit owners will no longer receive the one-off $100 rebate after last year’s change.
Danielle Gavin, Head of Property Management at Peter Blackshaw Manuka, believes the increase in rates could have a potential impact on the Canberra rental market, as investors try to recoup increasing costs.
“Investors are being faced with an increase in rates and taxes. Eventually, they will need to make up for these increasing expenses—this may not necessarily result in an increase of rent for tenants. There are many other ways an investor could recuperate costs through measures such as preventative maintenance or long-term leases. These are options that could be explored before increasing rent.”
The government has announced several upgrades and plans for renewal across the city. This is welcome news for investors and homeowners who will benefit from approved accessibility and amenities in their suburb and town centres.
- $10.5 million has been dedicated to a new bikeway, connecting Belconnen Town Centre with the University of Canberra and Belconnen suburbs such as Florey and Bruce
- $4 million will be provided to improve cycling and footpaths in the Tuggeranong Town Centre, connecting Anketell Street to Lake Tuggeranong
- $4.7 million has been committed to the renewal of Woden Town Centre
- A $47 million primary school will be built in Molonglo, providing places for 600 kindergartens to year 6 students
- A new $2.9 million walk-in medical centre in Gungahlin, to be opened in late 2018
The government has also committed $750,000 to exploring “innovative housing choices”. Though little information was disclosed, it is expected the government will explore options to boost innovative solutions to help with affordable housing.
If you would like to know more about what the 2018-2019 budget means for you and your property, contact your local Peter Blackshaw office.