By REIWA President – Hayden Groves https://reiwa.com.au/
As the State Government prepares its 2018/19 State Budget, the real estate industry is urging Treasurer Ben Wyatt not to increase property taxes as a means of budget repair.
Western Australians are still doing it tough, and although we have seen mild improvements in the housing market, increases in transfer duty will jeopardise future growth.
Housing affordability is still a prevalent issue for many Western Australians, and increasing property taxes will simply take homeownership out of the reach for many of those looking to enter the market.
The budget should ensure all Western Australians can meet their housing needs, from first homeowners to seniors looking to downsize.
REIWA believes bringing back the First Home Owner Grant (FHOG) of $3,000 for existing dwellings will boost the market and provide greater choice. It will also encourage first homeowners into existing suburbs where they can utilize pre-existing infrastructure and amenities.
Any increases in land tax will be passed on to tenants, making rent less affordable. WA has already experienced huge hikes in land tax in recent years and any more would simply discourage investment, leading to a lack of rental stock and ultimately pushing up prices.
For many seniors, the burden of transfer duty inhibits them from moving into more suitable accommodation. A concession for seniors would allow them to live in smaller, more easily maintained accommodation whilst freeing up larger housing stock for young families.
Now is certainly not the time to introduce a foreign investor tax. WA needs all the investment it can get, and placing additional taxes on foreign investors put WA construction jobs at risk. Ultimately, WA’s property tax system should be thoroughly reviewed with a view to remove inefficient taxes that hinder growth.
Safe and suitable housing is intrinsic to the success of local communities and the State Government should be doing everything it can to ensure access to home ownership is a reality for everyone. Now is not the time to be burdening property with additional taxes.
In the upcoming State Budget, REIWA is calling on the State Government to:
- Commit to no increase in transfer duty rates or changes to thresholds.
- Maintain the existing transfer duty exemption for first homebuyers under $430,000 and reintroduce the $3,000 grant for existing dwellings.
- Introduce a $10,000 transfer duty concession for over 65’s looking to “right size.”
- Make no further changes to rate or thresholds on land tax.
- Defer or revoke the introduction of a foreign owner duty surcharge.
- Undertake a state review to assess the impact of the removal of transfer duty for a broader based land tax.