Property Australia

Big and bold budget for Victoria

PROPERTY AUSTRALIA November 24, 2020

Victoria has unveiled a ‘big and bold’ vision for the state’s recovery from the impact of its COVID-19 lockdown, including support for new home buyers, build-to-rent and social housing.

The Property Council’s Victorian interim executive director, Matthew Kandelaars, said the budget handed down yesterday was historic in its proportions and included some critical stimulus measures for the property industry.

“The Budget is an unprecedented response to one of the worst economic chapters in our state’s history. The property industry welcomes the core focus on stimulus to drive Victoria’s economic recovery,” Kandelaars said.

Key measures in the Budget include:

  • Tax relief on stamp duty for residential property transactions will be provided for property transactions of up to $1 million. A waiver of 50 per cent for new residential properties and 25 per cent for existing properties will be available until 30 June 2021. These waivers will apply over and above existing concessions. The waiver for new residential properties apply to off-the-plan developments and will also apply to any property that has not previously been sold to assist developers clear a backlog of stock.
  • From 2022, a 50 per cent land tax discount for eligible new build-to-rent developments until 2040. These developments will also be exempt from the Absentee Owner Surcharge over the same period.
  • The Victorian Homebuyer Fund has been established with funding of $500 million to contribute to the purchase price of a new home, by way of a shared equity arrangement. The Fund will contribute to the purchase price of both new and existing properties in exchange for an equity interest – reducing the size of the required deposit.
  • $111 million committed to streamlining planning processes and reducing red tape, including $52 million to implement the Commissioner for Better Regulation’s planning reforms and to support the Victorian Planning Authority’s Streamlining for Growth program.

“The stamp duty waivers will have an immediate and positive effect for first home buyers, young families and retirees,” Kandelaars said.

“This targeted measure will pull forward economic activity and get development happening across the state - getting Victorians into work and into homes.”

In the lead-up to the budget, the Government a $5.3 billion investment in social housing upgrades and construction, supporting the construction of 9300 new social housing dwellings, and 2900 affordable homes.

Nearly $800 million has been invested in a household energy efficiency package including $335 million to replace old wood, electric or gas fired heaters with new energy-efficient systems for low-income earners. The other major features include $112 million to seal windows and doors, and upgrade heating, cooling and hot water in 35,000 social housing properties, and $191 million to expand the Solar Homes program, including 42,000 additional solar rebates and 15,000 new solar rebates for small businesses.

Kandelaars added that with the continued positive health outcomes that Victoria is experiencing, the Budget is a chance to look forward to a brighter 2021, including progress in reactivating Melbourne’s CBD.

“The next step in our economic revival is to continue the steady and measured return to the CBD, starting next week when up to 25 per cent of workforces can return to their CBD office workplaces,” he said.