Top 5 benefits from last weeks Budget for Property Investors

With so much information coming out of the Budget release last Tuesday night, it can be hard to sift through and see what is important for you. If you currently own investment property or you’re looking to get in to the market, these 5 benefits you just gained from the Budget.


  1. Pay less Capital Gains Tax

Capital gains tax can be reduced if your investment property is rented out to help the housing affordability issue in Australia.

  • Rent the property out at below the market rate
  • Give the property management to a Community Housing Provider (like the NRAS managers, I think).
  • The tenants need to qualify as low to medium income earners (the Government’s definition of medium income is now $150,000 pa)
  • It needs to be in this rental environment for at least 3 years in total.
  • The benefit is that you will be get a 60% discount on the capital gain instead of 50% reduction. Plus you will get more tax refunds or pay less tax on the rental income because of the lower rental income.
  • This could be used to reduce the amount of capital gains tax on existing property with large capital gains that are unlikely to sell within the next 3 years.
  1. Retirees Downsize Opportunity

Retirees can downsize their home and put up to $300,000 each into super regardless of their age.

  • This might free up more houses for investors and owner occupiers,
  • might take some pressure of property prices at the mid to high property prices.
  • Might put pressure on the property prices at the lower end of the market where the retirees will be purchasing. Better to secure this type of property now.
  • This could open up market to sell to retirees property that is more suited to their situation that is not a retirement village. Dual living houses and small lot properties with good facilities and close infrastructure.
  1. Property Hot-Spotting

The Government will allocate extra funding to open up property opportunities in western Sydney.  This could be the start of more specific funding to promote areas where population growth is expected.  This area of western Sydney could be a potential future property hot spot.

  1. Government Cuts Bank’s Profit

The bank levy will reduce bank profits so there is a chance they will increase interest rates to compensate for the levy.  To give you an idea the levy on NAB alone will reduce their ‘before tax’ profit by 4.0% pa ($367m).  Might be time to talk with your finance broker about your current interest rates.

  1. Government to sell off assets

The Government will release new land to be used for development sites – this might help take some pressure of land prices.



Tell us what else you found interesting in the Budget and if you have any questions about how this may affect you let us know, we’d love to hear from you.


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Until next time, keep connecting.

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