The recent economic movements surrounding the Australian real estate market have overall leant towards the prioritisation of Australian investors against foreign ones.
According to Resort Brokers Australia, the management right initiative of the government can’t be any more than helpful.
Following the controversial flare-up in the recent withdrawal limitation imposed by the People’s Republic of China on its affluent class, the Australian government assured all local investors a better footing when it comes to real estate via the new stamp duty and land tax.
Accommodating for the Future Australian Generations
The new taxation surcharges exclusive to foreign buyers in NSW, Victoria, and Queensland will undoubtedly limit the purchasing ease of international clients in capitalising on the proactive development scene in the country.
The Australian Financial Review reports, “Foreign-owned property owners and developers operating in Australia includes Frasers Property Australia, the former ASX-listed Australand business, which is now wholly owned by Singapore-listed and Thai-controlled Frasers Centrepoint. In order to dissuade international capitalization, the government took the initiative to buy locals time to make their investments first.
Early Onset of Tax Effects
In NSW, international buyers on residential properties and CBD apartment complexes will be required to fulfill a 4 percent stamp duty surcharge plus a 0.75 percent land tax surcharge starting June 21, 2017. Victoria will revamp its surcharges to 7 percent stamp duty and 1.5 percent land tax on July 1, 2017. Queensland 3 percent stamp duty surcharge will take effect on October 1, 2017.
The cost of surcharge will compound at least tens of thousands of dollars to the total purchase costs for foreign investors focusing on procuring apartments and houses.
Apart from helping its citizens to thrive first, the NSW, Victoria, and Queensland governments will be able to collect millions of funding in the process. Since most international contract acquisitions are still active, foreigners will have no choice but to comply. The proceeds from the surcharges will be then reciprocated back to the local economy and improve the condition of Australia’s real estate industry.