[VIC] Temporary Off-The-Plan Land Transfer (Stamp) Duty Concession @ State Revenue Office, Victoria

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[VIC] Temporary Off-The-Plan Land Transfer (Stamp) Duty Concession @ State Revenue Office, Victoria
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SupeNintendoChalmers on 21/10/2024 - 13:41 sro.vic.gov.au (332 clicks)
Last edited 22/10/2024 - 11:35 by 1 other user

Vic government must be getting desperate to restart unit and apartment builds.

More than happy to buy an apartment in Brighton, lease it to "lower class" people to annoy the pearl clutchers there.

The state government is reducing stamp duty for units, apartments and townhouses bought off-the-plan.

The concession allows construction costs to be deducted from the sale price of the dwelling when calculating the stamp duty owed on the transaction.

A discount was already available for first home buyers and owner occupiers, but for the next 12 months will be available to all buyers and to eligible dwellings at any price.

Source: ABC News

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Comments

  • Serpeant on 21/10/2024 - 13:43

    Are these good investments? I hear that these "off the plan" deals are generally bad as most of the profits are absorbed by the developer? Fine if you want to live in them though.

    • xyron on 21/10/2024 - 13:55
      +1

      No. You buy an apartment for rental yield, not capital growth. There are some rare exceptions, such as older units in low density blocks (certainly nothing off the plan).

      • 4foxache on 21/10/2024 - 14:00
        +11

        You really don't buy apartments at all if you want to make any money.

    • M00Cow on 21/10/2024 - 14:16
      +1

      The real savings is pitching your tent on the proposed building site saving all that money on rent

  • SupeNintendoChalmers on 21/10/2024 - 13:44
    +1

    depends on the builder and timelines. I've been monitoring prices over the last 6 months, so will be interesting if they rise.

    • vee on 21/10/2024 - 16:47
      +1

      bought one from a reputable developer, who built my friend's townhouse. I bought an apartment from the same developer. They changed builder and quality was shit.

  • JohnnyP on 21/10/2024 - 13:47
    +12

    Lambs to the slaughter.

    Most apartments/units in Melbourne have zero or negative capital growth. Huge supply

    • sangohan on 21/10/2024 - 14:33
      +20

      People vehemently ask for affordable housing, up until the moment they manage to purchase themselves, after which they demand capital growth.

      • tonyjzx on 21/10/2024 - 15:02
        +9

        well i mean sinking $600k plus into a 2 bed dogbox with a slew of faults… which is a depreciating asset sounds like a pile of shit to me… all while you're paying $5k in strata fees

        i mean… nah

    • DONMAI on 21/10/2024 - 21:59

      This 'deal'. QED.

    • Dollar General on 21/10/2024 - 13:51
      +2

      But the properties are still there. If they were properties being listed on Airbnb then it’s probably better they have been sold.

      If properties for sale were taking a much longer time to sell, then you can say the government has stuffed up the state, but if properties are selling, it’s a sign everything is still fine

      • UFO on 21/10/2024 - 14:30
        +1

        The properties are being purchased, yes. But for those that rent out of necessity what happens to them with less available?

        • Dollar General on 21/10/2024 - 15:01

          How do you know another landlord hasn’t bought it?

          Also, the fastest growing landlords are Airbnb landlords, which are not benefiting long term renters

        • Jolakot on 21/10/2024 - 16:20
          +2
          1. If an investor buys it, nothing.
          2. If an owner-occupier buys it, then the house they previously lived in becomes available.
          3. If they were renting, now there's an extra rental available, so it's a 1:1 trade.
          4. If they owned the previous house and are selling it, then GOTO 1.
          • scanuck on 22/10/2024 - 02:58

            @Jolakot: Decent summary - but you didn’t capture all scenarios

            (I’m not listing others as I don’t want to be involved in the discussion that would inevitably follow)

          • UFO on 22/10/2024 - 19:39

            @Jolakot:

            1. If they were renting, but their old lease expired and they needed to find a new rental… but they can't get one because now someone else has bought it… then GOTO sleeping in the car.
            • Jolakot on 22/10/2024 - 19:45
              -1

              @UFO: Why can't they renew the lease? Is the owner of their current rental also selling? If they are selling, who is moving into the house? They clearly live in a small town with only 2 ex-rentals, is someone new moving to the town? What colour are their walls???

              • UFO on 22/10/2024 - 20:49

                @Jolakot: Spoken like someone who's never rented before, and never had the frustration of having to leave a current rental (for whatever reason), needing to find another one in a month and not having any luck due to the massive increase in competition and potential renters offering $50 more a week just to get into a place.

                With less rental stock (thousands less in Victoria's market, fact), and an ever increasing amount of people looking to rent, supply isn't keeping up with demand. And when that happens rents skyrocket (like they have been) and desperate people miss out.

                These moves by Victoria's Government may seem like a terrific idea, but in reality its putting the most pressure on those trying to find a rental. Investors don't give a crap, they'll just find another state/market to invest in.

                • Jolakot on 22/10/2024 - 23:12

                  @UFO: I was in that exact situation a few years ago, had to move away from the area that we liked and pay more for a worse place in a worse suburb.

                  I now live in a home I own, it used to be a rental. So that's +1 rental available from the place I moved out of, and - 1 rental available for the house I moved into. It's like signing a 30 year lease with a landlord.

                  Sounds like your actual frustration is with immigration? Because if the population was stable, then no one would miss out.

                  Does your logic work in reverse? If I sold my house to an investor and moved to a rental, does that help or hurt the situation?

                  • UFO on 23/10/2024 - 23:18

                    @Jolakot: Can't tell if joking or intentionally trying to gaslight (poorly)?

                    To buy a house you need a deposit.
                    Most people renting don't have a deposit.

                    Thousands of less rental properties available due to poor taxation policy, and you're blaming immigration?
                    Forget about the fact we NEED immigration otherwise our population would be decreasing, and then we would be in a world of hurt like China is right now. Future tax payers needed for all the rest of us.

                    I won't be replying again. You speak of logic, but don't have any.

                    • Jolakot on 24/10/2024 - 10:23

                      @UFO: If you have 100 houses and 100 families, nobody misses out. If you add an extra 10 people without building more houses first, then 10 people will miss out and become homeless. If 10 new houses are built in a crappy area, and the 10 new people are all high income earners, then 10 lower income earners are eventually going to be displaced to the crappy area.

                      Immigration is fine, I'm a second-gen immigrant, but in the last 2 years we've had close to 1 million new immigrants (net overseas migration). Assuming 2 people to a family, do you really think they've built 500,000 new houses in that time?

                      The thousands of rentals we might be losing due to bad tax policy are literally a drop in the bucket, like someone with a severe gambling addiction blaming a Netflix subscription for their money woes.

    • besttechadvisor on 21/10/2024 - 13:53
      +17

      Good, housing shouldn't be a speculative commodity…

      • UFO on 21/10/2024 - 14:29

        And the people who can't afford to buy, and NEED to rent?

        There is so little rental stock on the market compared to even 3 years ago, that these people become homeless for the first time in their lives.

        Like it or not, investors are needed to supplement the housing market.

      • Grok on 21/10/2024 - 14:41
        +1

        Good and producing and selling food shouldn’t be a profit making endeavour as well.

        People should produce and sell food and provide housing and accommodation for people for the good of humanity and especially for all our new migrants.

        It’s outrageous that some people want to profit from such basic human needs

        Doctors should work for base wages as well, health is too important to profit from.

        • Jolakot on 21/10/2024 - 16:15
          +1

          I like how you bring it from 'Housing shouldn't be a speculative commodity' to 'Housing shouldn't be a profit making endeavor' to 'Housing should be provided for free', it's like watching an old Jewish man haggling at a charity shop.

        • mskeggs on 21/10/2024 - 16:15
          +1

          There is a difference between being paid for your work as a food vendor, versus your speculation as a property investor.
          Trying to confuse the two isn't helpful.

    • noobshoes on 21/10/2024 - 17:21
      +1

      The poor landlords, the poor poor landlords who could invest elsewhere and not be sociopaths.

  • skye89 on 21/10/2024 - 13:50
    +15

    How many shoddy builds by shonky builders will we see from this?

    • Mike Nolan on 21/10/2024 - 14:49
      +1

      Knowing the demographic of Melbourne…. Tons. Same deal with western Sydney.

      • SupeNintendoChalmers on 21/10/2024 - 18:19
        +1

        Funny thing that, I got stooged by a carpenter whose surname is Nolan!

    • DONMAI on 21/10/2024 - 22:00

      Lol "site inspections" YouTube?

  • Rod M on 21/10/2024 - 13:54
    +15

    wasn't there a report showing that more than 50% of all med/high density builds had major defects and legal proceedings against the developers?

    • Telios on 21/10/2024 - 16:43
      +1

      As is tradition!

      Government money = scammers scamming

      Don't forget all the deaths from pink bats installers, or the scammy door to door VEC salesmen, or energy rebates… Etc

      Anywhere there's fat on the lamb the wolves come to bite

      • Jolakot on 21/10/2024 - 22:00

        These programs were wildly successful at their actual goal - inflating employment numbers and increasing circulating cash to starve off recession.

        It doesn't really matter whether these people are hired to install insulation, or solar panels, or light bulbs, or even just sit on their thumbs all day drinking beer.

        It's kept us from the worst of the GFC, and it's keeping us from the worst of whatever they'll call the current recession.

  • xyron on 21/10/2024 - 13:54
    +3

    This is all just bonkers to me.

    There is no lack of supply of apartments in Melbourne. Look at pretty much any 2br apartment for sale in Carlton, North Melbourne and surrounds and they will not have gone up in value over the last decade or more.

    People don't want them. People want land. The difficulty is, with our population growth, it's just not feasible to expect a 500sqm block in Brunswick to cost now what it cost 20 or 30 years ago.

    • Dollar General on 21/10/2024 - 15:05
      +5

      Need more 3 bedroom apartments though. Should be more development incentives for this rather than smaller ones so they can squeeze more in to maximise $$

    • Jolakot on 21/10/2024 - 16:22
      +1

      Then why are they still so expensive? One of those crappy apartments still costs more than a proper brick house did 10 years ago.

      • xyron on 21/10/2024 - 17:26
        +1

        That's right. Because the supply of apartments has gone up, but the supply of land has not (and cannot) increase. As a colleague once said to me: "they aren't making any more Foot-a-scray"

  • edgar28 on 21/10/2024 - 14:00
    +2

    Developer will jack up the price now….

    • firefly2k3 on 21/10/2024 - 14:07
      +5

      I think the technical term they would like to use is price restructuring. I doubt these concessions ever get passed down to the consumer in any meaningful way… it's just a way for the businesses to make more money.

    • entropysbane on 21/10/2024 - 14:10
      +1

      Yes, economic rent.

    • TheMills on 21/10/2024 - 17:12
      +2

      Can't agree more. It will be same as 10k first home owner grant. When such a first home buyer contacts the developer, they don't buzz on price. Basically, they make sure they eat up the 10k grant.

  • Doesnotcompute on 21/10/2024 - 14:01

    Vic gov attempting to attract people to these 15 minute cities. Expect living standards to drop in suburbs you see high density apartments popping up with little investment in infrastructure, roads etc. Thats why these 15 min cities are expected along train lines. I had also heard that the vic gov may be looking to sneak in public housing in to these apartment buildings. Proceed with caution

    • M00Cow on 21/10/2024 - 14:33
      +15

      OMG, who'd want to have all your facilities within a 15-minute walk or bike ride sounds terrible. I'd rather get in my car and get stuck in traffic accessing all these wonderful things.

      Fancy building high density living along a train line. we can't have people close to public transport hubs!

  • mathew42 on 21/10/2024 - 14:03

    Great news that should combine well with 50 higher-density housing development zones across Melbourne.

    Other state governments would be wise to follow.

  • Frozensage on 21/10/2024 - 14:05

    Firstly, credit are tight and banks can’t lend out money with the tight regulation. Hence cost of money will be high hence price will be high hence still unaffordable to most. In the end nothing much will get done. Only ppl who can afford are ppl with overseas money or downsizing. All these announcements are just for show that gov is doing something. Want affordable housing? Get the government to build it, see how much that will cost the tax payers, and how long it takes. In 10 years nothing much will have changed and even less ppl will be able to afford housing.

  • toyrcr on 21/10/2024 - 14:19
    +9

    I just completed a project for two townhouses just over 2 years ago in Melbourne. Terrible investment
    - Land tax has changed so now all apartments will need to be taxed (and my land tax just double in the last year, not just because i have 2 properties on the land as it hasn't been divided yet)
    - Shonky builder (started out ok with quality products buts as the material got more expensive decided to cheapen out on everything, i'm still claiming warranty on items)
    - Tenants rules outweigh Landlords ($30 per inspection when you actually sell the property, notice period for tenants is shorter than for the landlord)
    - Dodgy Agents not doing correct background checks (tenant trashed one of my properties and bond didn't cover half of the repairs)

    In the short term, this may lower the price of housing in melbourne for the current market, but long term they are pushing investors out so that supplies will eventually dry up as the the ROI is terrible. When speaking to other investors and selling agents, investors are moving out to purchase in Brisbane and Adelaide, there is no capital growth in the short term especially if rent is not meeting repayments.

    • thangcuoi on 21/10/2024 - 14:31
      +1
      • Land tax has changed so now all apartments will need to be taxed (and my land tax just double in the last year, not just because i have 2 properties on the land as it hasn't been divided yet)

      From what I understand, land tax are not applicable on your primary resident/home. You're getting tax because this is an investment property.

      • rodericb on 21/10/2024 - 16:21

        The post doesn't say anything about either of the two residences being their PPOR. Apartments do have an equivalent bit of land and as the threshold for land tax has dropped to $50k they will become subject to land tax.

    • UFO on 21/10/2024 - 14:31

      yep!

    • OzzyBrak on 21/10/2024 - 14:40
      +4

      Honestly pushing investors out of real property and moving back towards public housing for those who need to rent would be better for everyone.

      • Grok on 21/10/2024 - 14:47
        +3

        The government would have to build millions of homes first and then you will pay for it somehow.

        • Jolakot on 21/10/2024 - 16:25
          +3

          We already are paying for it, the government spends $5 billion each year on housing assistance payments. Would build an awful lot of homes for $5 billion…

        • OzzyBrak on 21/10/2024 - 17:30
          +2

          I’d happily pay extra taxes for it. I’d love to see my fellow Australians move out of parks and their cars and into stable secure government housing. I’d love to see how their mental health improves when housing stress is removed from their lives. Where the government only increases rent with cpi or the wage index.

          The only people who don’t want it are people who view housing as risk free money, the investment the government won’t let you lose on. I’d prefer if we instead see housing as somewhere that people need to live and be happy and raise a family. Our society will be much better off when we value people having a home over housing as a risk free investment vehicle.

          • Grok on 21/10/2024 - 22:34
            +2

            @OzzyBrak: Most people don’t see housing as an investment already, it’s their home.

            A home that is expensive to build, maintain and pay taxes, levies and utilities on due to the nanny state supported by people who think like you. Over regulation is killing us.

            Supplying million dollar homes to the 35% of Australian who aren’t able or willing to buy one has to be paid by everyone else.

            Do you think the government can supply housing cheaper than private enterprise? Ludicrous. Public housing is already a lottery win for tenants. Fully maintained homes for a nominal rent.

            Very few people have more than one investment property, they are not causing the current housing problem. Outrageously high immigration, high building costs, massive regulation and a lack of available land is the reason.

            The government would have bigger problems than private enterprise in building enough homes as they can’t stay below ANY budget.

            • OzzyBrak on 21/10/2024 - 22:47

              @Grok: You’re confidently incorrect. Look into the history of housing in Australia and how the Commonwealth Housing Commission built the housing that was needed for people.

              I’d recommend reading The Great Divide
              Australia's Housing Mess and How to Fix It by Alan Kohler. https://www.quarterlyessay.com.au/essay/2023/11/the-great-di…

              • Grok on 22/10/2024 - 00:14
                +1

                @OzzyBrak: Nothing I said was wrong. While you quote a paid essay from an ABC reporter. Spare me.

                Albo is promising to build a few thousand homes for many billions of dollars. Australia needs millions of homes, then prices would drop.

                All I see is the Government making things worse. The government needs to get out of the way, release land, turn back regulation and taxes and massively reduce immigration.

                Private enterprise can fix the problem.

      • sistermay on 21/10/2024 - 14:52
        +1

        Good to see if that experiment works out in Victoria.
        Good for everyone ?? Have you seen trahsy tenants trashing the rental properties and left the bills to the poor landlords ? In your case, will be the government = taxpayers there to pay for the to get built then pay for all the repairs. Good luck to you all Victorians, enjoy it !!

        • Jolakot on 21/10/2024 - 16:24
          -1

          Sounds like someone skimped out on landlord insurance

          • CachePC on 21/10/2024 - 19:43
            +3

            @Jolakot: Yeah it's always good to fork out hundreds if not a thousand plus because when a tenant does 20k wrecking your kitchen and the insurance says they will give you 9 because they say they won't pay to replace because it's 7 yrs old - been there and you don't get what you think you pay for with insurance. 10 weeks loss of rent when a tradie can't fit it for 4 months - a good tenant who looks after your significant asset is worth it

            • Jolakot on 21/10/2024 - 21:48
              -1

              @CachePC: Paying a thousand for $9000 seems like a better investment return than real estate.

              A good tenant is worth a lot, so is a good agent that does their job.

    • Grok on 21/10/2024 - 14:45
      +3

      You would have to be bonkers to invest in property in todays world.

      Everything is stacked against you, everything!

      Invest in the sharemarket, there is still a window where you can invest there and make a return, despite the Greens and their academic friends wanting to tax it all into submission.

      • JSONBourne on 21/10/2024 - 14:57

        Only thing is it’s not leveraged (yes yes quirky builder). And most people are only owning their own home until later in life when they can possible afford an IP.

  • Kaboda on 21/10/2024 - 15:00
    +1

    This is so they can shaft you later for land tax. Landlords can't sell their properties fast enough.

  • CachePC on 21/10/2024 - 15:11
    +1

    Tim Pallas was a smart man (or so he thought).

    He introduced a COVID levy where if you own 2 or more properties, you pay an additional levy. Was "smart" in that if people decided to sell because of the levy, he got the stamp duty by new purchaser. If you kept, you paid the levy.

    Now look at annual real estate growth rate in Vic compared with other states (https://www.proptrack.com.au/home-price-index/). Melbourne (-1.5% annually) and rest of Vic (-1.7%) compared with national average of 6.2%.

    With the proposed changes where a rental in Victoria needs to have insulation but a home you own and live in does not - these rental reforms are not really going to achieve anything. Throw in the significantly increasing cost of insurance for body corporates, its hard to justify. We 'contribute' to having a tenant stay 16k due to all these additional charges in Vic - sure we get a tax deduction but there's little to or no capital gain so we would not do it again.

    • Nom on 22/10/2024 - 15:40
      +1

      Now look at annual real estate growth rate in Vic compared with other states (https://www.proptrack.com.au/home-price-index/). Melbourne (-1.5% annually) and rest of Vic (-1.7%) compared with national average of 6.2%.

      Are you listing this as a positive or a negative ?

      It reads like only Vic has been (slightly) successful in tackling unaffordable house prices, and everywhere else has failed miserably - the none-Vic properties are more overpriced than ever before.

  • mr_asstight on 21/10/2024 - 15:23
    +5

    So investors fled VIC, now the gov wants to tempt them back. How about they stop their commie policies like rental standards, rent caps, land tax and let the private market decide.

      • nightelves on 21/10/2024 - 16:12
        +2

        It because their fleeing Victoria via public transport.

      • rodericb on 21/10/2024 - 16:26
        +1

        That's public transport which landlords don't use. You should look for Rolls Royce's and Bentley's on the roads….. You won't see many, which proves mr_asstights point!

  • Trying2SaveABuck on 21/10/2024 - 17:40
    -2

    another sh1t idea from Victorian Alp

  • clover on 21/10/2024 - 18:15
    +1

    Aside from the concerns with living conditions, capital growth, and defects, the building timeline can be extended for years, and builders could potentially go bankrupt.

  • NoHorny on 21/10/2024 - 23:16

    Non-compliant!! Non-compliant!! Non-compliant!!

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